[Best HELOC Rates](/blog/heloc-rate-negotiation-guide) in Memphis 2026

Memphis presents a unique housing market characterized by exceptional affordability, with median home values around $215,000—significantly below most major metros. Despite this affordability, Memphis homeowners who purchased in the past 5-10 years have built substantial equity thanks to steady appreciation and low entry prices.

This guide examines the best HELOC rates available to Memphis homeowners in 2026, covering local credit unions, regional banks, and national lenders serving the Mid-South.

Current Memphis HELOC Rates

HELOC rates in Memphis currently range from 7.80% to 10.35% APR depending on credit profile, loan-to-value ratio, and lender. Tennessee's favorable regulatory environment and Memphis's competitive banking market create opportunities for qualified borrowers.

Memphis-area lenders include:

Local Credit Unions: Orion Federal Credit Union, Patriot Bank, and Electro Savings Credit Union offer competitive rates with deep Memphis knowledge.

Regional Banks: First Horizon Bank (Memphis-headquartered) and Renasant Bank provide regional expertise.

National Banks: Wells Fargo, Regions Bank, and Truist maintain significant Memphis presence.

Online Lenders: Figure, LendingClub, and other digital lenders serve Memphis borrowers with streamlined processes.

Top HELOC Lenders in Memphis

First Horizon Bank

Headquartered in Memphis, First Horizon offers HELOCs with deep local market knowledge. Current rates start around 7.80% APR.

Highlights:

• Memphis headquarters means strong local commitment
• Understanding of Memphis neighborhoods
• Up to 85% CLTV
• Relationship banking benefits
• Borrow up to $500,000
• Extensive Mid-South branch network

First Horizon's Memphis roots and understanding of neighborhoods from Midtown to Germantown to Cordova make them a natural choice for local borrowers.

Orion Federal Credit Union

Orion FCU serves Memphis and surrounding areas with competitive HELOC rates starting around 7.85% APR.

Highlights:

• No closing costs on many HELOCs
• Up to 90% CLTV
• Membership broadly available
• Local decision-making
• Understanding of Memphis market
• Community focus

Electro Savings Credit Union

Electro Savings serves the Memphis area with HELOCs starting around 7.95% APR.

Highlights:

• Competitive member rates
• Up to 85% CLTV
• Local market knowledge
• Flexible qualification criteria
• Multiple Memphis locations
• Personal service

Renasant Bank

Renasant maintains strong Memphis presence with HELOCs starting around 8.00% APR.

Highlights:

• Regional expertise
• Understanding of Mid-South market
• Up to 85% CLTV
• Relationship pricing available
• Local branches
• Responsive service

Figure

Figure's digital platform serves Memphis homeowners entirely online with rates starting around 8.10% APR.

Highlights:

• Fully online application and approval
• Funding in as few as 5 days
• Borrow $15,000 to $400,000
• Up to 95% CLTV (property dependent)
• No prepayment penalties
• Tech-driven process

For Memphis professionals seeking convenience, Figure offers speed and digital-first service.

Memphis Market Characteristics

Exceptional Affordability

Memphis offers some of the nation's most affordable housing among major metros:

• Median home values around $215,000 (2026)
• Significantly below national median
• Large homes for the price
• Low barrier to entry for homeownership

This affordability means lower mortgage balances and more accessible home equity for many homeowners.

Steady Appreciation

Despite affordability, Memphis has seen consistent appreciation:

• 6-9% annual appreciation 2020-2025
• Recovery from 2008-2012 recession complete
• Growing investor interest
• Median values have more than doubled since 2012

Homeowners who purchased 5-10 years ago typically have substantial equity available.

Economic Drivers

Memphis's economy centers on several key industries:

Logistics and Distribution: FedEx World Hub (largest employer), Memphis International Airport (major cargo hub), Amazon, multiple distribution centers

Healthcare: St. Jude Children's Research Hospital, Methodist Le Bonheur Healthcare, Regional One Health, Baptist Memorial Health Care

Biotech: Growing medical research and biotech sector centered around St. Jude

Manufacturing: Still significant despite decline from peak

Tourism: Beale Street, Graceland, Civil Rights Museum, music heritage

This mix provides economic diversity, though FedEx's dominance creates some concentration risk.

Neighborhood Variations

Memphis neighborhoods have distinct characteristics affecting property values:

Midtown: Urban, walkable, historic homes, Cooper-Young, Overton Square, strong appreciation

East Memphis/Germantown: Affluent suburbs, good schools, higher values

Downtown: Revitalization, condos, young professionals, appreciating

Cordova: Suburban, family-oriented, newer construction

Collierville: Upscale suburb, excellent schools, high values

North Memphis/Frayser: More affordable, diverse, varying conditions

Southaven (MS): Technically Mississippi but Memphis metro, growing rapidly

Lenders familiar with Memphis understand these neighborhood dynamics and their impact on equity positions.

How Much Can You Borrow?

Memphis homeowners can typically borrow based on:

Combined Loan-to-Value (CLTV): Most lenders allow 85-90% CLTV.

Example: If your Memphis home is worth $220,000 and you owe $130,000 on your mortgage:

• At 85% CLTV: You could borrow up to $57,000 ($187,000 - $130,000)
• At 90% CLTV: You could borrow up to $68,000 ($198,000 - $130,000)

Credit Requirements: Most competitive rates require FICO scores of 680+, though some lenders work with borrowers at 620+ (at higher rates). Memphis lenders often have more flexible credit policies than coastal markets.

Income Documentation: Memphis's diverse economy means lenders see varied employment types. Standard W-2 or 1099 documentation typically required.

Common HELOC Uses in Memphis

Memphis homeowners typically use HELOCs for:

Home Improvements: Kitchen/bathroom remodels, roof replacements, HVAC upgrades, foundation repairs (common in older Memphis homes)

Debt Consolidation: Paying off high-interest credit cards or auto loans

Investment Properties: Memphis has strong rental demand and investor activity; some use HELOCs for rental property down payments

Education Expenses: Funding college costs (University of Memphis, Rhodes College, Christian Brothers University, out-of-state schools)

Medical Expenses: St. Jude and other medical centers mean some residents use HELOCs for significant medical costs

Business Capital: Funding small businesses in Memphis's entrepreneurial community

Emergency Reserves: Backup funds for unexpected expenses

Draw Period vs. Repayment Period

Standard HELOC structure:

Draw Period (typically 10 years): Borrow and repay up to your credit limit. Minimum payments often interest-only, though you can pay principal.

Repayment Period (typically 15-20 years): No additional borrowing. Your balance amortizes with [principal and interest](/blog/amortization-schedule-guide) payments.

Understanding this structure prevents payment shock when transitioning between periods.

Fixed-Rate Options

Several lenders offer features to manage rate volatility:

First Horizon: May offer fixed-rate conversion options (inquire about current offerings)

Regions Bank: Provides fixed-rate advance capabilities

These features allow protection against rising rates while maintaining HELOC flexibility.

Qualifying for Best Rates

To access the lowest Memphis HELOC rates:

1. Credit score 700+: Memphis lenders often more flexible than coastal markets, but higher scores still get better rates
2. Conservative CLTV: Borrowing at 80% rather than 90% often saves 0.25-0.50%
3. Stable employment: Two+ years with current employer strengthens applications
4. Existing relationship: First Horizon, Orion, local institutions offer relationship discounts
5. Low debt-to-income: Keeping DTI below 43% improves approval odds
6. Property condition: Well-maintained homes appraise better
7. Shop multiple lenders: Rates can vary by 1%+ for identical profiles

Application Timeline

Typical Memphis [HELOC application](/blog/heloc-application-process-step-by-step):

1. Pre-qualification (1-2 days): Initial credit review, rate quote
2. Full application (3-5 days): Documentation submission
3. Appraisal (1-2 weeks): Required by most lenders; costs $300-450 in Memphis (lower than many markets)
4. Underwriting (1-2 weeks): Income verification, title search
5. Closing (3-5 days): Sign documents, three-day rescission period
6. Funding: Access after rescission

Total timeline: 4-6 weeks for traditional lenders, 10-14 days for online lenders like Figure.

Tennessee-Specific Considerations

No State Income Tax

Tennessee has no state income tax on wages (though there's a tax on interest and dividend income for high earners). This increases take-home pay compared to many states.

HELOC interest deductibility depends on federal tax rules, not state taxes.

Property Taxes

Shelby County property taxes are moderate:

• Average 1.2-1.8% of assessed value
• Lower than many states
• Homestead exemptions available
• Various exemptions for seniors, veterans, disabled

Older Housing Stock

Memphis has significant older housing stock:

• Many homes built pre-1980
• Foundation issues common (soil conditions)
• Roof, plumbing, electrical updates often needed
• Many homeowners use HELOCs for major maintenance

Lenders familiar with Memphis understand these characteristics and factor them into valuations.

Historic Neighborhoods

Memphis has numerous historic districts:

• Cooper-Young, Vollentine-Evergreen, Central Gardens
• Some properties have historic designation
• Renovation work may require approval
• Historic character often supports property values

Property Value Considerations

Appraisal Challenges

Memphis's affordability can create appraisal challenges:

• Wide variation in neighborhood values
• Some areas with declining values
• Appraisers must carefully select comparables
• Property condition significantly impacts value

Work with lenders experienced in Memphis to navigate these issues.

Investment Property Prevalence

Memphis has significant investor activity:

• Strong rental demand
• Low purchase prices attract investors
• Some neighborhoods have high rental concentration
• Lenders may scrutinize neighborhoods with high investor activity

Tax Deductibility

HELOC interest may be tax-deductible if used to "buy, build, or substantially improve" your home. Tennessee has no state income tax on wages, so only federal deductibility applies.

Tax situations vary. Consult a tax professional, especially if you itemize federal deductions.

[HELOC Alternatives](/blog/heloc-alternatives)

[Cash-Out Refinance](/blog/cash-out-refinance-guide): If current mortgage rates are competitive with your existing rate, cash-out refinancing might provide better overall terms.

Home Equity Loan: Fixed rate and predictable payments make sense for lump-sum needs.

Personal Loan: For smaller amounts ($10,000-$30,000), personal loans avoid home collateral risk, though rates are higher.

FHA 203(k) Loan: For major renovations, FHA 203(k) loans combine purchase/refinance with renovation funding.

Red Flags to Avoid

Excessive Fees: While reasonable costs are normal, avoid lenders charging:

• Application fees over $100
• Origination fees over 2% of credit line
• Annual fees over $100
• Prepayment penalties

Predatory Lending: Memphis has experienced predatory lending issues. Warning signs:

• Pressure to close quickly
• Fees buried in fine print
• Rates far above market
• Targeting specific neighborhoods

Property Condition Issues: Don't use HELOCs to patch failing properties without comprehensive repair plans. Address underlying issues properly.

Unlicensed Lenders: Verify lenders are licensed in Tennessee through the Tennessee Department of Financial Institutions.

Bottom Line

Memphis homeowners have solid HELOC options in 2026, with rates starting around 7.80% for well-qualified borrowers. First Horizon Bank's Memphis headquarters and deep local knowledge make them a top choice, while Orion Federal Credit Union and Electro Savings Credit Union offer competitive rates with community focus.

The best HELOC for you depends on priorities:

• Best rates: First Horizon, Orion FCU
• Local expertise: First Horizon, Electro Savings
• Regional knowledge: Renasant Bank
• Fastest funding: Figure, online lenders

Memphis's exceptional affordability creates unique opportunities—lower mortgage balances mean more accessible home equity, while steady appreciation has built substantial equity for longer-term owners.

However, Memphis-specific factors require attention: older housing stock means maintenance needs, neighborhood variations are significant, and property values can fluctuate more than in higher-priced markets.

Shop multiple lenders familiar with Memphis, ensure property condition supports your desired borrowing amount, and align your HELOC strategy with long-term financial goals. Memphis's affordability and appreciation create a solid foundation for strategic [home equity borrowing](/blog/home-equity-loan-vs-heloc-2026) when approached responsibly.

Related Articles

• [Home [Equity Explained](/blog/home-equity-explained): What It Is and How to Build It](/blog/home-equity-explained)
• [Best College Towns for [Rental Property Investment](/blog/best-states-for-rental-property-investment-2026)](/blog/best-college-towns-for-rental)
• Best HELOC Rates in 2026: Where to Find the Lowest Rates