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The question this analysis answers
The Figure HELOC offers a fixed rate with an origination fee of up to 4.99%. Many bank and credit union HELOCs charge little or no origination fee but use a variable rate. Borrowers ask a simple question that most reviews do not answer with numbers: is the fee worth paying for a fixed rate? We built a model to find out.
How we built the model
- Cash needed: $100,000 in hand in both options.
- Fixed option: borrow $105,252 so that $100,000 remains after a 4.99% fee, at a fixed rate of 7.50% or 8.00%.
- Variable option: borrow $100,000 with no origination fee, starting at 8.50%.
- Repayment: both loans fully amortize over 10 years. The variable payment is recalculated each year at the new rate.
- Cost measured: total paid if the loan is closed out after 2, 5, or 10 years, minus the $100,000 received. This captures interest plus the fee.
- Rate paths: rates stay flat; rise 2 points over two years; or fall 1.5 points over two years.
These rates are illustrative, not quotes, and closing costs other than the origination fee are excluded. The model shows how the trade-off works; it does not predict your exact cost.
Result 1: fixed at 8.00% with a 4.99% fee
| Rate path | Pay off in 2 years | Pay off in 5 years | Hold 10 years |
|---|---|---|---|
| Rates stay flat | Variable cheaper by $5,075 | Variable cheaper by $4,776 | Variable cheaper by $4,457 |
| Rates rise 2 points | Variable cheaper by $4,160 | Fixed cheaper by $930 | Fixed cheaper by $5,280 |
| Rates fall 1.5 points | Variable cheaper by $5,760 | Variable cheaper by $8,974 | Variable cheaper by $11,491 |
Result 2: fixed at 7.50% with a 4.99% fee
| Rate path | Pay off in 2 years | Pay off in 5 years | Hold 10 years |
|---|---|---|---|
| Rates stay flat | Variable cheaper by $4,066 | Variable cheaper by $2,488 | Variable cheaper by $1,140 |
| Rates rise 2 points | Variable cheaper by $3,151 | Fixed cheaper by $3,218 | Fixed cheaper by $8,596 |
| Rates fall 1.5 points | Variable cheaper by $4,751 | Variable cheaper by $6,686 | Variable cheaper by $8,174 |
Even with a full percentage point lower rate, the fixed option did not overcome a 4.99% fee when rates stayed flat.
Result 3: how the fee level changes the answer
Holding the fixed rate at 8.00% and rates flat, we changed only the origination fee:
| Origination fee | Pay off in 2 years | Pay off in 5 years | Hold 10 years |
|---|---|---|---|
| 0.00% | Fixed cheaper by $962 | Fixed cheaper by $2,190 | Fixed cheaper by $3,190 |
| 1.99% | Variable cheaper by $1,372 | Variable cheaper by $503 | Fixed cheaper by $234 |
| 2.99% | Variable cheaper by $2,581 | Variable cheaper by $1,898 | Variable cheaper by $1,298 |
| 4.99% | Variable cheaper by $5,075 | Variable cheaper by $4,776 | Variable cheaper by $4,457 |
Around a 2% fee, the two options are close to even over 10 years. At 3% and above, the fixed option needs rising rates to win.
What this means for Figure HELOC borrowers
- If you will repay within about two years, a high origination fee is hard to justify. A no-fee line usually costs less.
- If you will keep the loan five years or more and worry about rising rates, a fixed rate can pay for its fee, but only if rates actually rise.
- Ask for your fee in dollars. The published maximum is 4.99%, but your offer may be lower. A fee near 2% changes the math considerably.
- Remember the full draw. The Figure HELOC funds the entire line at closing, which also affects cost. See our full draw analysis.
- Compare real offers. Use the HELOC calculator and our comparisons with Aven and Spring EQ.
Limitations of this Figure HELOC model
This is a simplified model. Real variable HELOCs often have interest-only draw periods, rate caps, and annual fees, and real fixed offers vary by credit profile. Taxes, other closing costs, and the value of payment certainty are not included. Rate paths are scenarios, not forecasts. We publish the assumptions so you can judge whether they fit your situation.
FAQs
Is the Figure HELOC origination fee worth it?
Why does the fee matter more than the rate?
Methodology: calculations by FigureLoansApp using standard amortization. Rates and paths are illustrative scenarios, not lender quotes or forecasts. Fee maximum from Figure Lending's published disclosures.
Our team researches home equity products using lender disclosures, NMLS records, CFPB data, and independent reviews. Every figure is fact-checked before publishing and pages are re-reviewed regularly. Our editorial standards · Report an error