HELOC Calculator

Lenders typically take a percentage of your home's appraised value — the combined loan-to-value (CLTV) cap, commonly 75-90% — and subtract the balance still owed on your existing mortgage. The formula is: credit line = (home value x max CLTV%) - existing mortgage balance. For example, a $400,000 home with an 85% CLTV cap and a $250,000 mortgage balance yields a $90,000 available line ($340,000 - $250,000). If the result would be negative — the mortgage already exceeds the lendable value — the available line is $0.

The draw period is the borrowing phase of a HELOC, typically lasting 3 to 10 years, during which you can borrow against your available credit line as needed. Payments during this phase are usually interest-only: monthly payment = outstanding balance x (annual rate / 100) / 12. Because only interest is paid, the outstanding balance does not decrease during the draw period.

Once the draw period ends, the HELOC enters the repayment period — you can no longer borrow, and the outstanding balance amortizes (principal plus interest) over the remaining term, often 10 to 20 years. Payments rise because you are now paying down principal in addition to interest, and often over a shorter period than the draw phase.

The repayment payment fully amortizes the balance carried into repayment using the standard reducing-balance formula: A = B x r x (1+r)^n / ((1+r)^n - 1), where B is the balance, r is the monthly rate (APR/12), and n is the number of repayment months (years x 12). If the rate is 0%, this simplifies to A = B / n.

Combined loan-to-value (CLTV) is the ratio of all loans secured by your home (your first mortgage plus the HELOC) to the home's appraised value. Lenders cap CLTV — commonly in the 75-90% range — to limit their risk if home values fall. A lower CLTV cap or a higher existing mortgage balance both reduce the amount you can borrow through a HELOC.

Most HELOCs carry a variable interest rate tied to an index (such as the prime rate) plus a margin, so as that index moves, so does your rate and payment. This calculator shows a snapshot at a fixed rate you enter; it does not model future rate changes, periodic/lifetime rate caps, or how an increase would affect your future draw or repayment payments.

Yes — for simplicity, the draw-period and repayment-period payments are computed on the full available credit line, since many borrowers draw most or all of an approved HELOC over time. If you plan to draw a smaller amount, your actual interest-only and repayment payments will be proportionally lower than what's shown here.

Yes. If your existing mortgage balance already exceeds the lendable portion of your home's value (home value x max CLTV), there is no equity available to borrow against and the credit line floors at $0. This commonly happens when home values have fallen or the mortgage balance is still high relative to the home's worth.

A HELOC is a revolving line of credit — like a credit card secured by your home — that you can draw from, repay, and redraw during the draw period, with interest charged only on the amount you've actually borrowed. A home equity loan, by contrast, disburses a single lump sum upfront and amortizes on a fixed schedule from day one, similar to a standard mortgage. This calculator models a HELOC's two-phase (draw, then repayment) structure.

No. This calculator models principal-and-interest cash flow only — it does not include appraisal or closing costs, annual maintenance fees, early-termination penalties, or a balloon-payment structure that some HELOCs require in place of full amortization at the start of repayment. Check your specific loan terms with your lender for these additional costs.

It varies by lender and borrower profile (credit score, income, debt-to-income ratio). The Federal Reserve/CFPB HELOC booklet illustrates 75% as a common example, while many lenders today cap combined loan-to-value at 80-90%. This calculator defaults to 85% but lets you adjust it to match your lender's actual terms.

Total interest combines two phases: draw-period interest (the interest-only payment multiplied by the number of draw months, since principal never reduces) plus repayment-period interest (the sum of interest portions across the amortizing schedule). Because the balance sits flat and fully outstanding throughout the draw period before it starts amortizing, HELOCs often accrue more total interest than a loan that begins amortizing immediately — this calculator's total-interest figures let you see that impact.

Some lenders let you convert some or all of an outstanding HELOC balance from a variable rate to a fixed rate, usually for a fee and typically at a somewhat higher rate than the current variable one in exchange for predictable payments. This calculator models a single fixed rate for simplicity, so if your lender offers a fixed-rate conversion option, re-run the numbers at that fixed rate to compare it against staying variable.

Because draw-period payments are interest-only, the jump to a fully-amortizing repayment payment can be large and sudden if you are not prepared for it. Before your draw period ends, compare this calculator's interest-only and repayment figures side by side, check whether your lender allows voluntarily paying down principal early (which lowers the balance repayment is computed on), confirm the exact date repayment begins, and budget for the higher payment well in advance rather than discovering it on the first repayment-period statement.