Housing
HELOC Calculator
Estimate interest-only and repayment payments for a home equity line of credit. Adjust the assumptions to test different scenarios and use the result as a planning estimate, not a promise.
Housing
HELOC Calculator
Result
How to use this calculator
Enter your home's current value, the outstanding mortgage balance (which determines your available equity), the credit limit you're considering, an estimated interest rate, and the draw period length. A HELOC has two phases: the draw period, when you can borrow and typically make interest-only payments, and the repayment period, when the balance converts to a fixed installment loan. This calculator estimates both phases so you can see the full picture before you apply.
If you're not sure what rate to use, check current HELOC rates from major banks — they're variable and tied to the prime rate, so rates from six months ago are probably stale. Because HELOC rates are variable and tied to benchmark rates, check a current lender quote before relying on any example rate.
What your result means
The draw period payment is interest-only on the amount you've borrowed — not the full credit limit. If you open a $60,000 HELOC and only draw $20,000, your payment is based on $20,000. That's the part most people underestimate: a HELOC feels low-cost during the draw period because you're not paying principal at all. The repayment period is where the payment jumps, sometimes significantly, because now you're paying off the full borrowed balance over a shorter window.
A quick gut-check: can you afford the repayment-period payment on your current income, not the income you expect to have? HELOCs tend to go sideways when borrowers plan around future raises, bonuses, or home sales that don't materialize on schedule.
What the math leaves out
HELOCs are variable-rate products. The rate can — and does — move with the prime rate, which means a payment that looks manageable today can be materially higher in two years. Lenders are required to cap lifetime rate increases (usually at 18%), but the path from current rate to cap can still represent hundreds of dollars per month in added payment. Run this calculator at your current rate and again at 3–4 points higher to stress-test the range.
This calculator also doesn't account for fees: origination fees, appraisal costs, annual maintenance fees, and early closure penalties vary by lender. Some HELOCs are genuinely low-cost. Others carry fees that erode the interest savings versus a personal loan or cash-out refinance. Ask for the full fee schedule before comparing options.
HELOC vs. home equity loan: which one fits your situation
A HELOC is a revolving credit line — you draw what you need, when you need it, and the available balance replenishes as you pay it down. It works well for ongoing projects with variable costs: a multi-phase renovation, a business that needs a cash cushion, or tuition paid in installments. A home equity loan is a one-time lump sum with a fixed rate and fixed payment schedule. It works better for a single defined expense: a full kitchen remodel, a specific debt payoff, or a down payment on a second property. Both use your home as collateral, which means the risk profile is the same — falling behind on either one puts equity and ownership at risk.
Frequently asked questions
How much can I borrow with a HELOC?
Most lenders allow you to borrow up to 80–85% of your home's appraised value, minus your outstanding mortgage balance. On a home worth $500,000 with a $300,000 mortgage, that's roughly $100,000–$125,000 in available equity. Some lenders go up to 90%, but those typically come with higher rates.
Is HELOC interest tax-deductible?
It depends on how you use the funds. Under current IRS rules, HELOC interest is deductible only if the money is used to buy, build, or substantially improve the home that secures the loan. Using a HELOC to pay off credit cards, fund a vacation, or cover tuition is not deductible. Confirm your specific situation with a tax professional before assuming deductibility.
What happens if home values drop?
If your home value falls below the combined total of your mortgage and HELOC balance, the lender can freeze or reduce your credit line — even if you haven't done anything wrong. This happened broadly during the 2008 housing correction. It's worth keeping this possibility in mind if you're planning around a HELOC being available long-term.