Calculate your estimated monthly payments for a Home Equity Line of Credit.
Your Estimated Payments
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Estimated Monthly Payment (Principal & Interest)
Understanding Your HELOC Payments
A Home Equity Line of Credit (HELOC) is a revolving line of credit that allows you to borrow against the equity you've built in your home. Unlike a home equity loan, which provides a lump sum, a HELOC functions more like a credit card, allowing you to draw funds as needed up to a certain limit during a draw period. After the draw period, you enter a repayment period where you must repay the borrowed amount plus interest.
The payments you make on a HELOC typically consist of both principal and interest. During the draw period, many HELOCs only require you to pay interest, allowing you to keep your initial payments low. However, this means you are not reducing the principal balance, and your payments will increase significantly once the repayment period begins.
How the HELOC Payment Calculator Works
This calculator provides an estimation of your monthly principal and interest (P&I) payment based on the HELOC amount, the annual interest rate, and the loan term (repayment period). It assumes a standard amortization schedule for the repayment phase.
The Formula:
The monthly payment (M) for a loan is calculated using the following formula:
M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1]
Where:
P = Principal loan amount (the total amount you borrow)
n = Total number of payments (Loan Term in Years * 12)
Breakdown of Inputs:
HELOC Amount ($): This is the total principal amount you are borrowing or plan to borrow.
Annual Interest Rate (%): The yearly interest rate charged on the borrowed amount. HELOC rates are often variable, so this is an estimate based on the current or expected rate.
Loan Term (Years): This refers to the repayment period of the HELOC, during which you pay back both principal and interest. This is crucial for calculating the P&I payment. The draw period is not directly used in this P&I calculation but is important context for HELOCs.
Important Considerations for HELOCs:
Draw vs. Repayment Period: Be aware of the distinction. Your initial payments might be interest-only during the draw period. This calculator focuses on the P&I payment during the repayment period.
Variable Interest Rates: Most HELOCs have variable rates tied to a benchmark index (like the prime rate). Your interest rate and thus your payments can change over time.
Fees: HELOCs may come with origination fees, appraisal fees, annual fees, or transaction fees. These are not included in this payment calculation but should be factored into the overall cost.
Minimum Payments: Lenders will have minimum payment requirements, especially during the draw period (often interest-only).
Tax Deductibility: Interest paid on HELOCs may be tax-deductible if the funds are used to buy, build, or substantially improve the home securing the loan. Consult a tax professional.
Use this calculator as a tool to estimate your potential repayment obligations. Always confirm the terms and conditions with your lender.
function calculateHELOCPayment() {
var principal = parseFloat(document.getElementById("helocAmount").value);
var annualRate = parseFloat(document.getElementById("annualInterestRate").value);
var termInYears = parseInt(document.getElementById("loanTerm").value);
var errorDiv = document.getElementById("calculationError");
errorDiv.style.display = 'none'; // Hide error by default
if (isNaN(principal) || principal <= 0) {
errorDiv.textContent = "Please enter a valid HELOC amount greater than zero.";
errorDiv.style.display = 'block';
return;
}
if (isNaN(annualRate) || annualRate < 0) {
errorDiv.textContent = "Please enter a valid annual interest rate (0 or greater).";
errorDiv.style.display = 'block';
return;
}
if (isNaN(termInYears) || termInYears 0) {
// Standard amortization formula
monthlyPayment = principal * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1);
} else {
// If interest rate is 0, payment is just principal divided by number of months
monthlyPayment = principal / numberOfPayments;
}
document.getElementById("monthlyPaymentResult").textContent = "$" + monthlyPayment.toFixed(2);
}