HELOC FEES · LAST VERIFIED APRIL 2026
HELOC Fees: Prepayment Penalties, Early Termination, Inactivity, Minimum Draw (2026)
Most HELOCs have at least one of these fee types. Most borrowers discover them only when they try to close the account or skip a draw year. Know before you sign.
Fee Types Explained
Prepayment Penalty
Charged if you pay off the HELOC balance within a set period (typically 2-3 years of origination). The lender waived closing costs upfront; this recovers those costs if you leave early.
Typical: $400-$900, or 1-2% of credit limit
Early Termination Fee
Charged when you close the HELOC account before the specified period, even if the balance is zero. Different from prepayment penalty, which applies to paying off the balance.
Typical: $250-$500 if closed within 2-3 years
Annual Fee
Flat fee charged each year for maintaining the open HELOC. Some lenders waive for customers with qualifying deposit accounts or balances.
Typical: $50-$100/year
Inactivity Fee
Charged if you do not draw from the HELOC for a specified period (usually 12-24 months). The lender's cost recovery for maintaining a committed but unused line.
Typical: $50-$150/year
Minimum Draw Requirement
Some HELOCs require an initial draw at closing (e.g. $10,000), starting interest charges immediately. Others require a minimum amount per draw ($500-$1,000) but no forced initial draw.
Typical: $5,000-$10,000 initial
Minimum Balance Requirement
Rare, but some lenders require you maintain a minimum outstanding balance. Constrains your ability to pay down the HELOC below the minimum.
Typical: None at most lenders
Lender Fee Comparison (April 2026)
| Lender | Prepay Penalty | Early Termination | Annual Fee | Inactivity Fee | Min Draw | Min Balance |
|---|---|---|---|---|---|---|
| Figure | None | $0 | $0 | $0 | $5,000 initial | None |
| Aven | None | $0 | $0 | $0 | None | None |
| US Bank | $0 | $250-$500 (if closed in 2.5y) | $0-$90 | $50 (if no draws in 12mo) | $5,000 | None |
| Chase | $50 | $50-$350 (if closed in 3y) | $50 | $50/yr | $10,000 | None |
| Wells Fargo | $0 | $0-$500 | $75 (waivable) | $50 (if no draws in 12mo) | $5,000 | None |
| Bank of America | $0 | $0-$450 (if closed in 3y) | $0 | $50 (if no draws in 12mo) | $5,000 | None |
| Discover | N/A (HEL) | N/A (HEL) | $0 | N/A | N/A | N/A |
| SoFi | N/A (HEL) | N/A (HEL) | $0 | N/A | N/A | N/A |
Fees sourced from public lender disclosures and product pages. Verify with your specific lender. Last verified April 2026.
How to Negotiate These Away
Deposit relationship leverage
Many banks waive annual fees and inactivity fees for customers with qualifying deposit balances ($25,000-$100,000). Ask your relationship manager before signing.
Competing offer negotiation
Bring a competitor's offer to your primary bank. Early-termination fees and annual fees are often waivable as a retention tool.
Choose digital-first lenders
Figure and Aven do not charge annual fees, inactivity fees, or prepayment penalties. If fees are a concern, a digital-first lender eliminates the issue.
Ask about minimum draw waiver
Some lenders will waive the initial minimum draw requirement for customers with strong credit profiles. It does not hurt to ask before signing.
What to Look For in Your Loan Documents
Section: ‘Early Termination’ or ‘Cancellation’
Contains the early-termination fee trigger, the period (usually 2-3 years), and the amount.
Section: ‘Fees and Charges’ or ‘Schedule of Fees’
Annual fee, inactivity fee, and minimum draw fee are typically in a single table here.
Section: ‘Minimum Draw’ or ‘Initial Advance’
Whether you must draw at closing, the minimum amount, and whether there is a minimum per subsequent draw.
Section: ‘Prepayment’
Some HELOC agreements explicitly state 'no prepayment penalty'. If this is not present, ask your lender in writing.
Section: ‘Suspension or Reduction of Credit Limit’
Covers lender rights to freeze or reduce your line. The 2008 freeze clauses are still here.
FAQ
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