The Mortgage Reports 2026 Home Equity Gap Index: $11 Trillion in Home Equity Is Going Untapped, Is Yours? | Mortgage Rates, Home Loan Guides & Expert Insights
Key Takeaways
- The Mortgage Reports analyzed ATTOM and HMDA data to build the first-ever Home Equity Gap Index, ranking all 50 states by how much equity homeowners have vs. how often they actually use it.
- Texas ranks #1 for untapped equity due to constitutional restrictions that make HELOCs harder to get, not because homeowners don’t want them.
- Utah leads the nation in HELOC activity with 142 originations per 10,000 homes.
If you’re a U.S. homeowner, you’re almost certainly sitting on accessible wealth you don’t think about. And almost certainly not using it.
American mortgage holders are currently carrying approximately $11 trillion in tappable home equity, according to ICE Mortgage Monitor, March 2026. Tappable means accessible: it’s equity available to borrow against while still keeping a 20% cushion in the home. And the overwhelming majority of it is sitting completely still.
The Mortgage Reports set out to quantify exactly where that gap between available equity and used equity is widest, and what it costs homeowners to leave it there. Using federal mortgage origination data and the latest ATTOM equity figures, we built the Mortgage Reports 2026 Home Equity Gap Index, a proprietary ranking of all 50 states by how much equity homeowners have versus how often they actually tap it through a home equity line of credit (HELOC).
What we found: the gap is enormous, it’s not evenly distributed, and the implications are significant for millions of American homeowners.
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What Is the Mortgage Reports 2026 Home Equity Gap Index?
To build the index, The Mortgage Reports combined two public datasets that haven’t previously been analyzed together:
- Equity-rich percentage by state: the share of mortgaged homes where the outstanding loan balance is less than 50% of the estimated home value. Source: ATTOM Q1 2026.
- HELOC originations per 10,000 homes by state: how actively homeowners in each state are actually opening home equity lines of credit. Source: HMDA 2025 via CFPB, analyzed by Refi.com.
We then divided each state’s equity-rich percentage by its HELOC usage rate to produce a Gap Score. A higher score means a state has abundant equity but low HELOC activity; homeowners are leaving significant wealth on the table. A lower score means homeowners are actively putting their equity to work.
For the full formula, data sources, and limitations, see the methodology section below.
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The Big Picture: $11 Trillion Sitting Idle
According to ICE Mortgage Monitor, March 2026, homeowners hold approximately $11 trillion in tappable home equity, down slightly from a mid-2025 peak of $11.6 trillion but still near historic highs. At the peak in mid-2025, homeowners were withdrawing just 0.41% of available tappable equity per quarter (ICE).
HELOC balances are growing. The NY Fed Q1 2026 Household Debt Report puts total outstanding HELOC balances at $446 billion, the 16th consecutive quarterly increase, up $129 billion from the Q1 2022 low. But even at that pace, the vast majority of available equity remains untouched.
Meanwhile, 43.3% of mortgaged homes in the U.S. are currently equity-rich, meaning the homeowner owes less than half what the home is worth. That’s down from a recent peak of 49.2% but still historically high (ATTOM Q1 2026).
The opportunity is large, but the take-up is small.
State Rankings: Where Equity Goes Unused, and Where It Doesn’t
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States With the Most Untapped Equity (Highest Gap Scores)
|
Rank |
State |
Equity-Rich % |
HELOCs per 10K |
Gap Score |
|---|---|---|---|---|
|
1 |
Texas |
42.5% |
11 |
386.4 |
|
2 |
New Mexico |
41.9% |
20 |
209.5 |
|
3 |
Alaska |
33.5% |
20 |
167.5 |
|
4 |
South Dakota |
52.4% |
33 |
158.8 |
|
5 |
Wyoming |
44.3% |
37 |
119.7 |
|
6 |
Vermont |
85.7% |
72 |
119.0 |
|
7 |
Montana |
57.7% |
49 |
117.8 |
|
8 |
Louisiana |
17.9% |
16 |
111.9 |
|
9 |
Florida |
43.2% |
44 |
98.2 |
|
10 |
Maine |
55.3% |
57 |
97.0 |
Source: The Mortgage Reports 2026 Home Equity Gap Index. Equity-rich data: ATTOM Q1 2026. HELOC data: HMDA 2025 via Refi.com.
Vermont is the most striking entry on this list. At 85.7% equity-rich, it is the most equity-rich state in the nation (ATTOM Q1 2026), and yet it ranks only 18th nationally in HELOC usage.
Vermont homeowners are proportionally wealthier in home equity than almost anyone else in the country, and they’re barely touching it.
Texas leads for a different reason, one that’s structural, not behavioral. More on that below.
States Where Homeowners Are Putting Equity to Work (Lowest Gap Scores)
|
Rank |
State |
Equity-Rich % |
HELOCs per 10K |
Gap Score |
|---|---|---|---|---|
|
1 |
Utah |
48.7% |
142 |
34.3 |
|
2 |
Rhode Island |
57.2% |
138 |
41.4 |
|
3 |
Wisconsin |
49.5% |
111 |
44.6 |
|
4 |
Ohio |
40.5% |
85 |
47.6 |
|
5 |
Oregon |
44.3% |
92 |
48.2 |
|
6 |
Idaho |
51.6% |
103 |
50.1 |
|
7 |
North Carolina |
42.1% |
83 |
50.7 |
|
8 |
Indiana |
42.0% |
74 |
56.8 |
|
9 |
Massachusetts |
53.2% |
93 |
57.2 |
|
10 |
New Hampshire |
58.1% |
101 |
57.5 |
Source: The Mortgage Reports 2026 Home Equity Gap Index. HELOC data: HMDA 2025 via Refi.com.
Utah leads the country with 142 HELOC originations per 10,000 homes (HMDA 2025). At the metro level, Madison, WI tops the nation at 254 originations per 10,000 homes, followed by Janesville-Beloit, WI (176) and Provo-Orem-Lehi, UT (175).
Top 10 Metros by HELOC Activity (2025)
|
Metro |
HELOCs per 10K |
Avg Credit Limit |
|---|---|---|
|
Madison, WI |
254 |
$106,605 |
|
Janesville-Beloit, WI |
176 |
$77,514 |
|
Provo-Orem-Lehi, UT |
175 |
$152,685 |
|
Ogden, UT |
169 |
$129,399 |
|
Iowa City, IA |
129 |
$83,328 |
|
Bend, OR |
129 |
$126,920 |
|
Coeur d’Alene, ID |
123 |
$155,845 |
|
Lexington-Fayette, KY |
123 |
$119,872 |
|
Kalamazoo-Portage, MI |
122 |
$94,849 |
|
Idaho Falls, ID |
122 |
$105,599 |
Source: HMDA 2025 data via CFPB / Refi.com analysis.
Why Texas Has Almost No HELOC Activity, and Why That Could Change
Texas records just 11 HELOC originations per 10,000 homes, the lowest rate in the country by a wide margin, producing a Gap Score of 386.4.
This isn’t about homeowner disinterest; it’s constitutional.
Texas is the only state in the nation where home equity lending is restricted by its state constitution (Article XVI, Section 50). The rules are unlike anything else in the country:
- Combined loan-to-value ratio (the total of all loans against the home divided by its appraised value) cannot exceed 80%
- Origination fees are capped at 2% of the loan principal
- A homeowner can only hold one equity loan on a homestead at a time
- There is a mandatory 12-day waiting period before a HELOC can close
- Closing must take place at a lender’s office, title company, or attorney’s office
- Loans are non-recourse; lenders cannot pursue borrowers personally for repayment
- No additional collateral can be pledged
- Borrowers cannot refinance a home equity loan within one year of origination
The result: HELOCs are harder to originate in Texas than anywhere else. Many lenders don’t bother offering them.
Yet when Texans do get HELOCs, they borrow more. The average Texas HELOC credit limit is $153,647, above the national average of $135,570 (HMDA 2025 via CFPB). The demand is clearly there, but the friction is structural, not attitudinal.
For Texas homeowners who want to access their equity, the path exists; it’s just narrower than in other states. Understanding the rules is the first step.
Related: Home Equity Loans and HELOCs in Texas
Why Americans Are Opening HELOCs Now: The Data Shows a Major Shift
The reason homeowners are tapping their equity has changed significantly over the past three years, and it tells you something important about where Americans are financially right now.
|
Purpose |
2022 |
2024 |
Trend |
|---|---|---|---|
|
Home renovations |
65% |
46% |
↓ Declining |
|
Debt consolidation |
25% |
39% |
↑ Surging |
Source: MBA 2025 Home Equity Lending Study.
In 2022, renovations drove nearly two-thirds of HELOC volume. By 2024, debt consolidation had surged from 25% to 39% of originations (MBA 2025) and is rapidly closing in on renovations as the dominant use case.
The reason is simple math. The average credit card APR is 21%, according to the Federal Reserve G.19 release (Q1 2026). A homeowner who moves $30,000 in credit card balances onto a HELOC may reduce their interest costs significantly. For a highly qualified borrower at 7.21%, the savings work out to about $4,137 a year. A more typical borrower at 8.5% would save closer to $3,750.
Because HELOC rates are variable, that 7.21% can rise over time, and stretching repayment over a longer term can increase the total interest paid, so the actual savings depend on the rate and how quickly the balance is repaid.
Related: HELOC Pros and Cons
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Who Is Using HELOCs, and Who Isn’t
Younger Homeowners Are Most Likely to Use HELOCs
It’s a common assumption that older, more established homeowners are most likely to use their equity. The data says otherwise.
According to TD Bank HELOC Trend Watch survey of more than 2,000 U.S. homeowners:
|
Generation |
Currently Have a HELOC |
Plan to Apply in Next 18 Months |
|---|---|---|
|
Gen Z |
41% |
73% |
|
Millennials |
38% |
66% |
|
Gen X |
30% |
53% |
|
Boomers |
– |
17% |
Among homeowners who bought within the last 10 years (TD Bank HELOC Trend Watch, Oct 2025), Gen Z is the most likely to currently hold a HELOC (41%), and 73% plan to apply for one in the next 18 months. This isn’t because younger homeowners have more equity; they don’t. It’s because they’re more likely to treat their home as a financial tool, not just a place to live.
Boomers, by contrast, hold an estimated 50% of all U.S. home equity, roughly $17.3 trillion according to ICE Mortgage Monitor, but only 17% plan to apply for a HELOC (TD Bank). That’s the single largest pool of accessible wealth in the country, and it’s mostly sitting still. For Boomer homeowners who are carrying debt, funding retirement expenses, or helping adult children, a HELOC may be worth a second look.
Using a HELOC to support retirement income or family transfers ties a fixed-income household to a variable-rate debt payment secured by the home. Talk to a fiduciary financial advisor — not just a loan officer — before going this route.
The Rate Environment: Why 2026 Is a Reasonable Time to Act
As of May 2026, the prime rate sits at 6.75% (FRED), with HELOC rates averaging around 7.21% (Curinos). That’s meaningfully lower than at any point in 2024, when HELOC rates were pushing close to 10% (Bankrate via FRED).
Whether rates move higher or lower from here is genuinely uncertain. What isn’t uncertain is the spread: credit card APRs averaging 21% (Federal Reserve G.19) versus HELOC rates in the low 7% range is a historically wide gap that makes equity-backed borrowing look attractive by comparison.
For homeowners who have been waiting for the “right time” to look at their equity options, the combination of near-record equity levels and rates that have come down substantially from recent highs makes 2026 a reasonable time to at least understand what you qualify for.
Note: HELOC rates are variable and can move in either direction. Always consult a licensed mortgage professional for a rate specific to your situation.
Check your HELOC eligibility. Start here
What To Do If You’re in a High-Gap State
If your state appears in the top-10 untapped equity list, or you’re simply not sure what you have, here’s a practical starting point. One thing to note is that a HELOC uses your home as collateral. If you cannot repay it, you could lose your home to foreclosure. Weigh that risk against the benefit before borrowing.
1. Find out your home’s current value: Your equity position starts with an accurate estimate of what your home is worth today, not what you paid for it. Most lenders offer free estimates, and several online tools can give you a ballpark.
2. Calculate your tappable equity: Subtract your outstanding mortgage balance from your home’s estimated value. Most lenders will let you borrow up to 80–85% of that figure, minus what you already owe.
3. Compare what a HELOC would actually cost: At 7.21%, the interest-only payment on a $50,000 HELOC draw is roughly $300 per month. Compare that to the minimum payments on the debt you’d be consolidating.
4. Check whether your state has restrictions: Texas homeowners face constitutional limits (see above). Most other states do not, but HELOC availability and lender appetite can still vary significantly by market.
5. Get a rate quote: Rates vary meaningfully by lender, credit score, and combined LTV. The only way to know what you’d actually pay is to ask.
The Bottom Line
The Mortgage Reports 2026 Home Equity Gap Index reveals something that raw equity statistics miss: having equity and using equity are two very different things. Millions of American homeowners, particularly in high-gap states like Texas, Vermont, and Florida, are sitting on significant wealth that could be working harder for them.
In some cases, like Texas, structural barriers explain the gap. In most others, the explanation is simpler: homeowners don’t know what they have, or haven’t done the math on what it would cost to access it.
The math isn’t complicated, and for the right homeowner, it’s worth running.
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Methodology: The Mortgage Reports 2026 Home Equity Gap Index
The Mortgage Reports 2026 Home Equity Gap Index is original research produced by The Mortgage Reports editorial and research team. It is published annually.
Formula: Gap Score = Equity-Rich % ÷ (HELOCs per 10,000 Homes ÷ 100)
Data sources:
|
Source |
Data Used |
Notes |
|---|---|---|
|
Equity-rich % by state |
Uses AVMs, not formal appraisals |
|
|
HELOC originations per 10K homes; avg credit limits (incl. national avg approved HELOC credit limit, $135,570) |
Voluntary reporting; not all lenders represented |
|
|
Tappable equity total (~$11 trillion) |
||
|
HELOC withdrawal rate (0.41% in Q1 2025) |
Referenced for scale comparison |
|
|
HELOC balance totals; quarterly trend |
Published May 12, 2026 |
|
|
HELOC purpose-of-use data |
2024 origination year |
|
|
Generational attitudes and usage |
n=2,000+ U.S. homeowners |
|
|
Current average HELOC rate (7.21%) |
Powers CFPB rate explorer; based on 780+ credit score, <70% CLTV |
|
|
Average credit card APR (21%, Q1 2026) |
||
|
Prime rate (6.75%) |
||
|
Texas constitutional restrictions |
Temporal note: ATTOM equity data reflects Q1 2026. HMDA origination data reflects full-year 2025. These are the closest available contemporaneous datasets and are analyzed together with that limitation disclosed.
Limitations: The Gap Index measures origination activity, not equity access attempts or denials. Lower HELOC activity in a state could reflect structural barriers (as in Texas), lender preferences, demographic factors, or homeowner choice. The index should be interpreted as a starting point for analysis, not a definitive ranking of homeowner financial behavior.
The Mortgage Reports Home Equity Gap Index may be cited in research and journalism with attribution to: The Mortgage Reports 2026 Home Equity Gap Index, themortgagereports.com.
The Mortgage Reports (NMLS #1019791) does not guarantee specific interest rates and does not recommend specific lenders. HELOC rates are variable and subject to change. Home equity products use your home as collateral; failure to repay could result in foreclosure. Consult a licensed mortgage professional before making borrowing decisions.
Full 50-state data available. For media and research inquiries, contact the editorial team at TheMortgageReports.com.
The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.
By refinancing an existing loan, the total finance charges incurred may be higher over the life of the loan.
