HELOC Calculator
Estimate your home equity line of credit: max credit line (CLTV), interest-only draw-phase payments, repayment amortization, draw schedules, rate shocks, and HELOC vs cash-out refinance.
Estimate only — not professional advice. This calculator gives educational estimates for a home equity line of credit. Actual terms depend on your lender, appraisal, credit profile, and market rates. Talk to a qualified financial professional before borrowing against your home.
Your home and line
Enter your numbers; results update live.
Credit line and rate
How to set the rate
Phases
Payments during draw period
Draw schedule
Your HELOC estimate
Estimate only — not professional advice. Payments assume a constant rate during each phase and ignore fees, taxes, and insurance.
Max credit line
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Approved line
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min(requested, max)
Effective APR
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after floor / ceiling
Draw-phase payment / mo
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Repayment P&I / mo
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Total interest (lifetime)
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draw + repayment
Rate shock: +2% APR
If your variable rate rose 2 percentage points (within the ceiling):
Interest-only payment: –
Repayment P&I payment: –
Balance over time
Yearly schedule
| Year | Phase | Paid | Interest | End balance |
|---|
HELOC vs cash-out refinance
Simple monthly-payment comparison. Assumes your current mortgage is a 30-year fixed.
Option A — Cash-out refinance
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per month, new single loan
Option B — Keep mortgage + HELOC
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per month, mortgage P&I + HELOC interest-only
Ignores closing costs, points, and fees. Compare total lifetime cost, not just the monthly payment.
How the math works
Max credit line = (home value × CLTV cap) − mortgage balance. With a $500,000 home, $300,000 balance, and 80% cap: ($500,000 × 0.80) − $300,000 = $100,000.
Interest-only payment = balance × APR ÷ 12. A $50,000 balance at 8.5%: $50,000 × 0.085 ÷ 12 = $354.17/month.
Repayment payment uses standard amortization: P × r(1+r)n ÷ ((1+r)n − 1). A $50,000 balance at 8.5% over 20 years = $433.91/month.
Variable rate = index + margin, clamped by your floor and ceiling. A 2% margin with a 3.5% floor and 18% ceiling turns an index of 16.5% into 18% (capped) and an index of 1% into 3.5% (floored).
HELOC FAQs
What is a HELOC?
A HELOC (home equity line of credit) is a revolving line of credit secured by your home. You can borrow, repay, and borrow again up to your credit limit during the draw period, which commonly lasts 10 years. After that comes the repayment period, commonly 20 years, when you can no longer draw and must repay principal plus interest. Most HELOCs have variable interest rates.
How is my maximum HELOC credit line calculated?
Lenders use a combined loan-to-value (CLTV) cap. Max line = (home value x CLTV cap) - current mortgage balance. Example: a $500,000 home with a $300,000 mortgage balance and an 80% CLTV cap gives ($500,000 x 0.80) - $300,000 = $100,000 of available credit. Caps of 80% to 85% are the most common.
How is the interest-only HELOC payment calculated?
During the draw period, most HELOCs require interest-only minimum payments: monthly payment = outstanding balance x annual rate / 12. Example: a $50,000 balance at 8.5% APR costs $50,000 x 0.085 / 12 = $354.17 per month in interest only.
What happens to my payment when the draw period ends?
You enter the repayment period: no new draws are allowed and your payment must cover principal plus interest, so it usually jumps. Example: a $50,000 balance at 8.5% amortized over a 20-year repayment period costs $433.91 per month, versus $354.17 interest-only during the draw period. Plan for this payment shock before you borrow.
Is a HELOC rate fixed or variable?
Most HELOCs have variable rates, typically an index (often the prime rate) plus a fixed margin. If the index moves, your rate and payment move with it. Plans usually include a rate floor and a rate ceiling (lifetime cap) that limit how far your rate can fall or rise.
What is the difference between a HELOC and a home equity loan?
A HELOC is a revolving line of credit with a variable rate and two phases (draw, then repayment). A home equity loan is a lump-sum installment loan with a fixed rate and fixed monthly payments from day one. Choose a HELOC for flexible, staged borrowing; choose a home equity loan when you need the full amount at once with predictable payments.
Does drawing my HELOC in stages save interest?
Yes, because you only pay interest on what you have actually drawn. Example at 8.5% over a 10-year draw period: drawing $60,000 all at once costs $51,000 in interest, while drawing $20,000 at month 1, $20,000 at month 7, and $20,000 at month 13 costs $48,450 - a saving of $2,550.
What happens to my HELOC payment if rates rise 2%?
An interest-only payment rises proportionally with the rate. Example: a $50,000 balance at 8.5% costs $354.17 per month interest-only; if the rate rises to 10.5%, the payment becomes $437.50 per month. On a 20-year repayment schedule the amortized payment rises from $433.91 to $499.19.
What are HELOC rate floors and ceilings?
The floor is the lowest rate your plan allows and the ceiling is the highest. Example with a 2% margin, 3.5% floor, and 18% ceiling: an index of 5% gives 7%; an index of 16.5% would give 18.5% but is capped at 18%; an index of 1% would give 3% but is raised to the 3.5% floor.
HELOC vs cash-out refinance: which has the lower monthly payment?
It depends on the rates. Example: with a $300,000 mortgage at 5% and $100,000 of cash needed, a cash-out refinance of $400,000 at 6.5% over 30 years costs $2,528.27 per month, while keeping the mortgage and adding a $100,000 HELOC at 8.5% interest-only costs $2,318.80 per month combined. Compare total lifetime interest too, not just the monthly payment.
Can I pay principal during the HELOC draw period?
Yes. Most plans let you pay more than the interest-only minimum during the draw period. Every extra dollar of principal lowers the balance that gets amortized in the repayment period, which shrinks the repayment payment and cuts total interest.
Is HELOC interest tax deductible?
Generally, HELOC interest is deductible only if the borrowed money is used to buy, build, or substantially improve the home that secures the loan, and only if you itemize deductions. Interest on money used for other purposes, such as paying off credit cards, is generally not deductible. Confirm your situation with a tax advisor.
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