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Discover can be a solid choice for home equity loans due to its competitive APR. Discover is best for homeowners with good credit scores (680), even if they don’t have very little equity in their homes, as the company will let you borrow up to 90 percent of your homeownership stake — more than most lenders allow. No closing costs, application, and origination fees make Discover appealing to those who want to pay minimal upfront costs.
Discover is probably best known as one of the largest card issuers in the U.S., cementing its position as a cash rewards pioneer when it launched its namesake credit card in 1986. In addition to the Discover card, parent company Discover Financial Services offers a variety of financial products, including home equity loans, which it launched in 2013.
Discover earns a 5 out of 5 for affordability due to its competitive APR and the absence of closing, origination, appraisal and application fees.
Discover offers flexible home equity loan term lengths and the ability to tap almost all of one’s home equity, but these strengths are offset by a high loan minimum and the absence of HELOCs, which pull it down to a 4.2 out of 5 for availability.
You can reach Discover’s customer service team online or on the phone every day. However, the company’s inability to offer in-person service or a dedicated loan officer (see “What consumers say,” below) pulls down its score to 2.9 out of 5.
You can tap into your home equity — the difference between your home's worth and what you owe on your mortgage — with a home equity loan or a HELOC. With those funds, you can tackle a variety of expenses, like debt consolidation or home renovations.
However, before you dive in, it's important to figure out your loan-to-value ratio (LTV). Lenders use your LTV to determine how much of your equity stake you can actually borrow. (It’s typically 80 percent, although some lenders allow you to access as much as 90 percent.) The amount of equity they’ll let you tap is one consideration when choosing a lender. Be it a retail bank, online lender or credit union, it may offer different home equity loan rates and terms, too. That’s why it’s important to shop around for the best deal.
Discover Bank has an A+ rating from the Better Business Bureau. For the second year in a row, the company ranked second in J.D. Power’s 2024 U.S. Consumer Lending Satisfaction Study, which measures customer satisfaction with consumer loan companies.
On Bankrate, customers say applying for a Discover loan was “as easy as it could be,” their rates were competitive and the customer reps were top-notch. However, some customers expressed frustration at the lack of an assigned loan officer: “Be prepared to speak to a different person just about every time you call in.”
Discover offers home equity loans between $35,000 and $500,000 with 10, 15, 20 and 30-year repayment terms.
Discover requires borrowers to have a FICO credit score of at least 680 to qualify for a home equity loan, as well as a history of responsible credit use and verifiable employment and income. There’s also a maximum debt-to-income (DTI) ratio — your monthly debt payments divided by your monthly gross income — of 43 percent.
Between your first mortgage and a Discover home equity loan, you can have a combined loan-to-value (CLTV) ratio of up to 90 percent (although the loan amount with that ratio is capped at $200,000). There are no minimum assets needed to close on the loan.
You can apply for a home equity loan with Discover online or by phone at 855-361-3435. Its customer service team is available Monday through Friday from 8 a.m. to midnight ET or Saturday or Sunday, 10 a.m. to 6 p.m. ET.
Discover requires borrowers to have a FICO credit score of at least 680 to qualify for a home equity loan, as well as a history of responsible credit use and verifiable employment and income. There’s also a maximum debt-to-income (DTI) ratio — your monthly debt payments divided by your monthly gross income — of 43 percent.
Between your first mortgage and a Discover home equity loan, you can have a combined loan-to-value (CLTV) ratio of up to 90 percent (although the loan amount with that ratio is capped at $200,000). There are no minimum assets needed to close on the loan.
Selected lender
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Discover
NMLS: 453156
Bankrate score
4.0
Bankrate scores are objectively determined by our editorial team. Interest rates, fees, loan terms, borrower requirements and customer service are some of the factors that make up Bankrate's score.
Customer score
3.1
Star ranking and total number reflects the lifetime customer reviews received while this lender has been an advertiser on Bankrate. To help serve you with relevant information, the customer reviews shown are limited to only those that this advertiser has received during the past 12 months.
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Bankrate score
Bankrate scores are objectively determined by our editorial team. Interest rates, fees, loan terms, borrower requirements and customer service are some of the factors that make up Bankrate's score.
Customer score
Star ranking and total number reflects the lifetime customer reviews received while this lender has been an advertiser on Bankrate. To help serve you with relevant information, the customer reviews shown are limited to only those that this advertiser has received during the past 12 months.
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Bankrate score
Bankrate scores are objectively determined by our editorial team. Interest rates, fees, loan terms, borrower requirements and customer service are some of the factors that make up Bankrate's score.
Customer score
Star ranking and total number reflects the lifetime customer reviews received while this lender has been an advertiser on Bankrate. To help serve you with relevant information, the customer reviews shown are limited to only those that this advertiser has received during the past 12 months.
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Loan amount |
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$35,000-$500,000 |
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Min. credit score required |
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680 (700 or higher for $150,000 or more) |
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Repayment terms |
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10 years to 30 years |
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Funds available in |
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Undisclosed |
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Recent customer review |
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DO NOT APPLY Discover Home loans keep sending you letters, take all information, let you submit for 2-3 week over and over paperwork, and then they deny you with explanation they cannot take yo... SL |
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NMLS: 453156
3.1
44 ratings
59% of customers would recommend this lender.
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To help serve you with relevant information, the consumer reviews shown below are limited to only those that this advertiser has received during the past 12 months.
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