A borrowing product with a variable interest rate can be risky in an environment in which interest rates are volatile or on an upward trend. And that's been the case for much of the last two years as a spike in inflation led to a series of hikes to the federal funds rate.

At today’s average HELOC rate of 8.88%, which assumes an 80% LTV, borrowing $100,000 on a 10-year repayment term equates to a $1,260.43 monthly payment. (Our calculation accounts for a 10-year draw period with interest-only payments.)

What are the key differences between a HECM and a HELOC? Industry educator Dan Hultquist breaks it down, along with a monthly rate update.

Fixed-rate HELOCs are a good option for many homeowners — but consider the current rate environment beforehand.