A home equity loan is a type of loan from which homeowners can borrow money against the value of their home. The loan is secured by the equity in your home. Home equity loans are often used for major expenses such as home improvements, education costs, debt consolidation, or medical bills. The amount you can borrow is based on the difference between your home's current market value and the outstanding balance of your mortgage(s).
When you take out a home equity loan, you receive a lump sum of cash upfront. This loan typically has a fixed interest rate and a fixed repayment period, usually between 5 and 15 years. Your monthly payments will consist of principal and interest payments. Because it's secured by your home, home equity loans often come with lower interest rates compared to unsecured loans like personal loans or credit cards.
Home Equity Loan Calculator
Use this calculator to estimate your potential home equity loan amount and monthly payments. Please note that this is an estimation and actual loan terms may vary.
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function calculateHomeEquityLoan() {
var homeValue = parseFloat(document.getElementById("homeValue").value);
var outstandingMortgage = parseFloat(document.getElementById("outstandingMortgage").value);
var loanToValueRatio = parseFloat(document.getElementById("loanToValueRatio").value);
var interestRate = parseFloat(document.getElementById("interestRate").value);
var loanTerm = parseFloat(document.getElementById("loanTerm").value);
var resultDiv = document.getElementById("result");
resultDiv.innerHTML = ""; // Clear previous results
if (isNaN(homeValue) || isNaN(outstandingMortgage) || isNaN(loanToValueRatio) || isNaN(interestRate) || isNaN(loanTerm) ||
homeValue <= 0 || outstandingMortgage < 0 || loanToValueRatio 100 || interestRate < 0 || loanTerm <= 0) {
resultDiv.innerHTML = "Please enter valid positive numbers for all fields. Loan-to-Value ratio must be between 1 and 100.";
return;
}
var maxLoanAmountBasedOnLTV = homeValue * (loanToValueRatio / 100);
var availableEquity = homeValue – outstandingMortgage;
if (availableEquity <= 0) {
resultDiv.innerHTML = "You do not appear to have sufficient equity in your home to qualify for a home equity loan based on the current mortgage balance.";
return;
}
var potentialLoanAmount = Math.min(maxLoanAmountBasedOnLTV, availableEquity);
if (potentialLoanAmount 0) {
monthlyPayment = potentialLoanAmount * (monthlyInterestRate * Math.pow(1 + monthlyInterestRate, numberOfPayments)) / (Math.pow(1 + monthlyInterestRate, numberOfPayments) – 1);
} else {
monthlyPayment = potentialLoanAmount / numberOfPayments; // Simple division if interest rate is 0
}
resultDiv.innerHTML = "