Home price appreciation may have moderated from its post-pandemic peaks, but many credit union members are still sitting on substantial untapped home equity. U.S. homeowners currently hold nearly $17 trillion in total equity, with approximately $11 trillion considered tappable, according to National Mortgage News.
They are also putting that equity to work. In 2025 alone, homeowners withdrew more than $200 billion in equity, the highest annual total since 2022. As interest rates remain elevated relative to the refinance boom, more borrowers are turning to home equity lines of credit (HELOCs) instead of cash-out refinances to access liquidity.
This shift is not temporary. Borrowers who secured historically low first-mortgage rates are increasingly reluctant to refinance those loans. Instead of pursuing cash-out refinances, they are seeking ways to access equity while preserving their existing terms.
Increasingly, however, capturing that demand depends on how those loans are delivered.
Why This Moment Is Different
Until recently, HELOCs remained largely tied to manual, paper-based processes. Even as first mortgages became more digital, home equity lending lagged behind, limiting its scalability and secondary market potential.
That is changing.
HELOCs can now be originated, tracked, controlled and managed as fully digital assets through systems like the MERS eRegistry – the national electronic registry that establishes control and ownership of digital mortgage assets. In practical terms, that means HELOCs can now follow the same digital lifecycle that has already transformed first-mortgage lending.
For credit unions, this is more than a technical milestone. It marks a shift in what is operationally possible.
The Opportunity for Credit Unions
Credit unions are well positioned to compete in the home equity market. Their member-first model, competitive pricing and established relationships give them an advantage in a product category built on trust and long-term financial decisions.
At the same time, borrower expectations have changed. Members increasingly expect lending experiences to match the speed and convenience of other digital financial services. Institutions that can deliver on those expectations are better positioned to capture growing demand.
This is where eHELOCs come into focus – not simply as a digital upgrade, but as a way to translate strong market demand into scalable lending growth.
The Gap Between Demand and Delivery
In many institutions, however, HELOCs remain constrained by how they are organized and delivered.
They often sit outside the mortgage function and are treated as a consumer lending product, using systems designed for auto or personal loans. While practical from an organizational standpoint, this can limit how effectively HELOCs are scaled – particularly as digital expectations and secondary market considerations become more relevant.
Traditional workflows are also frequently manual and fragmented, leading to longer cycle times, higher costs and borrower experiences that fall short of expectations.
As demand increases, these limitations become more visible – and more consequential for growth.
eHELOCs as the Growth Enabler
eHELOCs apply the same digital principles that have already reshaped first-mortgage lending, replacing paper-based workflows with fully digital processes across application, closing and loan management.
The impact is straightforward. Digital workflows reduce processing time, limit manual errors and create more convenient borrower experiences. Structuring HELOCs as true electronic assets – with electronic notes and secure digital records – also establishes clear ownership and control, supporting broader adoption and secondary market execution.
For credit unions, this is less about incremental efficiency and more about scalability. Institutions that adopt eHELOC capabilities are better positioned to increase volume, improve consistency and compete with lenders that have already modernized their home equity offerings.
A Shift in How Growth Is Defined
eHELOCs are not simply a new product capability. They reflect a shift in how credit unions can approach growth in a more complex rate environment.
While first-mortgage volume may fluctuate, home equity offers a more stable source of lending activity. The challenge is no longer demand – it is the ability to deliver these products efficiently and at scale.
Credit unions that align their strategy, operations and technology around that reality are better positioned to capture the opportunity in front of them.
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