15-year Mortgage Rate Calculator

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HELOC (Home Equity Line of Credit) Calculator

Your Potential Credit Line

$0.00

function calculateHeloc() { var homeValue = parseFloat(document.getElementById("homeValue").value); var mortgageBalance = parseFloat(document.getElementById("mortgageBalance").value); var cltvLimit = parseFloat(document.getElementById("cltvLimit").value) / 100; if (isNaN(homeValue) || isNaN(mortgageBalance) || isNaN(cltvLimit)) { alert("Please enter valid numeric values for all fields."); return; } // Logic: (Home Value * LTV Limit) – Existing Mortgage = Available HELOC var maxLtvAmount = homeValue * cltvLimit; var availableLine = maxLtvAmount – mortgageBalance; if (availableLine < 0) { availableLine = 0; } var equityTotal = homeValue – mortgageBalance; var resultArea = document.getElementById("helocResultArea"); var finalDisplay = document.getElementById("finalHelocAmount"); var breakdown = document.getElementById("helocBreakdown"); finalDisplay.innerText = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(availableLine); breakdown.innerHTML = "Based on a " + (cltvLimit * 100) + "% Combined Loan-to-Value (CLTV) limit, your total borrowing power is capped at " + new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(maxLtvAmount) + ". After subtracting your current mortgage of " + new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(mortgageBalance) + ", your estimated HELOC limit is " + new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(availableLine) + "."; resultArea.style.display = "block"; }

Understanding Your HELOC Borrowing Power

A Home Equity Line of Credit (HELOC) functions much like a credit card secured by your home. Unlike a standard home equity loan that provides a lump sum, a HELOC allows you to withdraw funds as needed during a "draw period" and pay them back over time.

How This Calculator Works

Lenders typically do not allow you to borrow 100% of your home's value. The Combined Loan-to-Value (CLTV) ratio is the key metric. Most lenders set a CLTV limit between 80% and 90%.

  • Home Value: The current fair market appraisal of your property.
  • Mortgage Balance: The total remaining principal on all existing loans secured by the home.
  • LTV Limit: The maximum percentage of the home's value the lender is willing to secure (80% is the industry standard).

Example Calculation

Imagine your home is worth $500,000 and you owe $300,000 on your primary mortgage. If a lender offers an 85% CLTV limit:

  1. $500,000 (Home Value) x 0.85 (CLTV Limit) = $425,000 Total Borrowing Capacity.
  2. $425,000 – $300,000 (Current Mortgage) = $125,000 HELOC Limit.

Key Factors for Approval

Beyond the equity in your home, lenders will evaluate several other criteria before approving a credit line:

  • Credit Score: A score of 700 or higher usually nets the best interest rates.
  • Debt-to-Income (DTI) Ratio: Lenders prefer a DTI below 43%.
  • Verifiable Income: You must prove you have the cash flow to handle potential interest-only or principal-plus-interest payments.

Note: This calculator provides an estimate for informational purposes. Actual credit limits are subject to professional appraisal and lender underwriting guidelines.

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