arkansas-heloc-guide) Rates & Lenders: Home Equity Guide for the Natural State

Arkansas is one of the most affordable housing markets in the country, and that cuts both ways for HELOC borrowers. On one hand, lower home prices mean smaller HELOC lines. On the other, affordable housing means many homeowners have been building equity quickly — especially those who bought in the last five years as prices climbed. The median home price in Arkansas is approximately $210,000, well below the national median of around $410,000.

If you're an Arkansas homeowner with equity to tap, here's what the HELOC market looks like in 2026.

Arkansas HELOC Market Overview

[HELOC rates](/blog/best-heloc-lenders-2026) in Arkansas currently range from about 7.50% to 9.75% APR for qualified borrowers. The market is served by a mix of regional banks, credit unions, and a limited set of national players.

Arkansas-based Arvest Bank (one of the largest banks in the state), Bank OZK (formerly Bank of the Ozarks), Centennial Bank, and Simmons Bank all offer HELOC products. Credit unions like Arkansas Federal Credit Union and Telcoe Federal Credit Union provide competitive alternatives.

National lenders have uneven coverage. Chase doesn't have branches in Arkansas. Bank of America has limited presence. Wells Fargo and US Bank are the most active national players. Online lenders like Figure and Spring EQ operate in the state.

Because competition is thinner than in states like Arizona or California, rates tend to be slightly above the national average. Shopping around matters more here.

The northwest Arkansas corridor (Bentonville, Rogers, Fayetteville, Springdale) has been the state's hottest real estate market thanks to the Walmart/Tyson/JB Hunt economy. Home prices there are notably higher than the state average — median around $310,000 — which means larger HELOC amounts are available.

[HELOC Requirements](/blog/heloc-application-process-step-by-step) in Arkansas

Equity Requirements

Standard CLTV limits of 80–90% apply. At Arkansas's median home price of $210,000 with a $130,000 mortgage balance, an 80% CLTV HELOC would give you up to $38,000. Not huge, but enough for a kitchen remodel or debt consolidation.

For larger lines, northwest Arkansas homeowners have more to work with. A $310,000 home with $180,000 owed, at 80% CLTV, unlocks up to $68,000.

Credit Score

740+: Best rates, around 7.50%–8.25% APR
700–739: Solid rates, roughly 8.25%–9.00% APR
660–699: Higher rates, approximately 9.00%–10.25% APR
Below 660: Limited options; some credit unions will consider 620+

Arkansas's average credit score trends slightly below the national average, around 695. If your score is in the upper 600s, working with a local credit union gives you the best shot at approval.

Income and DTI

Most lenders require DTI below 43%, with some flexibility to 50%. Arkansas's median household income is about $53,000 — one of the lowest in the nation. Lenders here are experienced working with moderate-income borrowers, and the low cost of living helps: your dollars go further in Arkansas, so DTI ratios tend to be healthier than the raw income numbers suggest.

If you work in the poultry industry, trucking, or retail (all major Arkansas employers), stable employment history matters more than peak income. Two years at the same employer or in the same industry strengthens your application significantly.

Property Types

Single-family homes are the bread and butter of Arkansas real estate and qualify easily. The state has relatively few condos and townhomes — most are concentrated in Little Rock, Fayetteville, and Bentonville. Manufactured homes are common, especially in rural areas. Getting a HELOC on a manufactured home is possible if it's on a permanent foundation and titled as real property, but many lenders decline these.

Homes with significant acreage (10+ acres) may face additional scrutiny. Lenders sometimes limit the appraised value to the home and a "reasonable" amount of surrounding land, excluding the agricultural value of large tracts.

Best HELOC Lenders in Arkansas

Arvest Bank

One of Arkansas's largest banks (also big in Oklahoma and Missouri), Arvest offers HELOCs with competitive rates and local underwriting. They have extensive branch coverage across the state, particularly strong in northwest Arkansas and the River Valley. Rates start around 7.75% APR for well-qualified borrowers. They offer a no-closing-cost option on lines up to $200,000. Arvest's local decision-making means they can often accommodate situations that national lenders' automated systems would decline.

Bank OZK

Headquartered in Little Rock, Bank OZK has grown from a community bank into a major regional player. Their HELOC product features competitive rates, flexible terms, and strong service. They're particularly good for higher-value properties and larger HELOC lines. Rates start around 7.75%–8.00% APR.

Arkansas Federal Credit Union

Based in Jacksonville and serving members across central Arkansas, AFCU offers some of the [best HELOC rates](/blog/heloc-rate-negotiation-guide) in the state — often 0.25%–0.50% below the banks. They also charge minimal closing costs. Membership is open to anyone who lives, works, or attends school in several central Arkansas counties. Current rates start around 7.50% APR.

Telcoe Federal Credit Union

Serving the Little Rock metro area, Telcoe offers competitive HELOC products with low fees. They're a smaller institution but known for personal service and flexibility. They'll work with credit scores down to 640 in some cases.

Simmons Bank

A strong regional bank headquartered in Pine Bluff (with major operations across the state), Simmons offers HELOCs with solid terms. They have good coverage in areas that some other lenders underserve, including south and east Arkansas.

Wells Fargo

The most prominent national bank operating in Arkansas. Their HELOC comes with autopay rate discounts and no annual fee. Rates start around 8.00%–8.25% APR. They're a solid comparison point against local lenders.

US Bank

Active in Arkansas with branches in Little Rock and northwest Arkansas. Competitive HELOC product with CLTVs up to 90% in established markets. Rates start around 7.75% APR with relationship discounts available.

Arkansas-Specific Regulations and Consumer Protections

Constitutional Homestead Protection

Here's where Arkansas gets really interesting. The Arkansas Constitution (Amendment 40, adopted in 2000) provides exceptionally strong homestead protections. For decades, Arkansas effectively prohibited second mortgages on homesteads, making HELOCs on primary residences nearly impossible.

Amendment 40 changed that by allowing home equity lending, but with significant restrictions:

80% CLTV cap: This is constitutional law in Arkansas, not just lender policy. You cannot borrow more than 80% of your home's value across all mortgages. No exceptions, no lender can go higher.
Fee cap: Closing costs on home equity loans cannot exceed 5% of the principal amount.
No single-pay balloon notes: The loan must be structured with regular payments.
12-day waiting period: After receiving the required disclosures, borrowers must wait at least 12 days before closing. This is on top of the federal 3-day rescission period.
Right to cure: If you default, you must be given 30 days to cure before foreclosure proceedings can begin.

These constitutional protections make Arkansas one of the most consumer-friendly states for [home equity borrowing](/blog/home-equity-loan-vs-heloc-2026). The 80% CLTV cap limits how much you can borrow, but it also protects you from overleveraging.

Judicial Foreclosure

Arkansas uses judicial foreclosure, meaning the lender must go through the court system. This process typically takes 6–12 months, giving borrowers significantly more time than non-judicial foreclosure states. This is a meaningful protection for HELOC borrowers.

[Homestead Exemption](/blog/homestead-exemption-guide) (Bankruptcy)

Arkansas offers an unlimited homestead exemption in bankruptcy — your home is fully protected regardless of value, as long as it's under 80 acres (rural) or a certain size in city limits. This is one of the most generous homestead exemptions in the country. Note: this doesn't prevent your HELOC lender from foreclosing (they have a voluntary lien), but it protects your equity from other creditors.

Tax Implications

Federal Deduction

Standard rules apply: HELOC interest is deductible on your federal return if funds are used for home acquisition or substantial improvement, up to the $750,000 combined mortgage debt limit.

Arkansas State Income Tax

Arkansas has a graduated income tax with rates ranging from 2% to 4.4% (reduced from higher rates in recent years through tax reform). The top rate of 4.4% applies to income above $87,000 (for 2026).

Arkansas allows itemized deductions on the state return, including mortgage interest. If you're deducting HELOC interest federally, you'll also deduct it on your Arkansas return.

The practical savings: on $4,000 of deductible HELOC interest, you'd save about $960 federally (at 24% bracket) and about $176 at the state level (at 4.4%). Total annual tax benefit of roughly $1,136.

Arkansas does not allow you to deduct federal income tax from your state return (unlike Alabama), so the calculation is more straightforward.

Property Tax Context

Arkansas has low property taxes, with an effective rate of about 0.63%. On a $210,000 home, that's approximately $1,323 per year. In northwest Arkansas, on a $310,000 home, it's about $1,953.

Property in Arkansas is assessed at 20% of market value, and then the local millage rate is applied. Rates vary significantly by county and school district.

Arkansas offers a homestead property tax credit of up to $375 per year for owner-occupied homes, which provides a modest reduction.

Low property taxes, like in Alabama, mean more of your monthly budget is available for HELOC payments — a factor lenders consider when calculating your DTI.

Frequently Asked Questions

Why is the HELOC process different in Arkansas?

Because of Amendment 40 to the Arkansas Constitution, home equity lending in Arkansas has specific rules that don't exist elsewhere. The 80% CLTV cap is written into the state constitution — not just bank policy. The 12-day waiting period after disclosure is unique to Arkansas. These rules were enacted to protect homeowners from predatory lending while still allowing access to home equity.

Can I get more than 80% CLTV on a HELOC in Arkansas?

No. The 80% CLTV limit for home equity lines of credit on homesteads is constitutional law in Arkansas. No lender can exceed it, regardless of your credit score, income, or equity position. If your home is worth $200,000 and you owe $140,000, the maximum HELOC is $20,000 ($200,000 × 0.80 = $160,000 − $140,000 = $20,000).

How long does it take to close a HELOC in Arkansas?

Due to the mandatory 12-day waiting period after disclosure, Arkansas HELOCs take longer than most states — typically 35–55 days from application to funding. Add the 3-day federal rescission period after closing, and you're looking at roughly 6–8 weeks from start to funding availability.

Are Arkansas [HELOC closing costs](/blog/heloc-closing-costs-breakdown) limited?

Yes. Under Amendment 40, total closing costs on a home equity loan cannot exceed 5% of the principal amount. On a $50,000 HELOC, that caps costs at $2,500. In practice, most lenders charge $500–$1,500, well below the cap. Some lenders offer no-closing-cost options.

What if I'm buying a second home or investment property in Arkansas?

The constitutional protections (and restrictions) of Amendment 40 apply specifically to homesteads — your primary residence. HELOCs on non-homestead properties in Arkansas are governed by standard lending regulations and can exceed 80% CLTV (though most lenders still cap at 80–90%). The 12-day waiting period also doesn't apply to non-homestead properties.

The Bottom Line

Arkansas is unique. The constitutional protections built into the home equity lending process are genuinely consumer-friendly — the 80% CLTV cap, fee limits, and mandatory waiting periods exist to protect you. They also make the process slower and limit how much you can borrow compared to other states.

For most Arkansas homeowners, the best bet is to start with a local institution. Arvest Bank and Arkansas Federal Credit Union should be on your short list. They understand Amendment 40's requirements inside and out, they process these loans regularly, and they typically offer the best rates. Compare against Bank OZK and one national lender (Wells Fargo or US Bank) to make sure you're getting a competitive deal.

Given the 80% CLTV cap, it's especially important to get an accurate appraisal. If your home has appreciated significantly and the appraisal reflects that, you'll have more equity to work with. Consider investing in improvements that boost appraised value before applying if you're close to the line.

Arkansas may add extra steps and time to the HELOC process, but the protections are there for a reason. Your home is safe, and you can still access your equity — just with guardrails that keep you from overextending.

[Home [Equity Explained](/blog/home-equity-explained): What It Is and How to Build It](/blog/home-equity-explained)
Property Taxes Explained: How They Work and How to Reduce Them
Arkansas HELOC Guide 2026: Rates, Lenders & Natural State Tips

Heloc Rates Arkansas

Key Takeaways