Texas HELOC Equity & Rate Calculator
Calculate your borrowing power under Texas Section 50(a)(6) rules.
Texas 80% LTV Cap:
Max Available HELOC Amount:
Calculated APR (Index + Margin):
Warning: Existing mortgage exceeds the 80% LTV limit allowed in Texas.
Understanding Texas HELOC Regulations
Texas has some of the most unique and protective home equity laws in the United States. Established under Article XVI, Section 50 of the Texas Constitution, these rules are designed to prevent homeowners from over-leveraging their primary residence.
The 80% Rule: In Texas, your total combined loan-to-value (CLTV) ratio cannot exceed 80%. This means the sum of your current mortgage and your HELOC limit cannot be more than 80% of your home's appraised value.
Key Texas HELOC Requirements
- The 12-Day Rule: You must wait at least 12 days after applying before the loan can be closed.
- Fee Cap: Closing costs and fees are limited to 2% of the line of credit amount (excluding appraisal and certain other fees).
- One Equity Loan: You can only have one equity loan or HELOC on your property at a time.
- Once-a-Year Rule: You cannot close more than one equity loan in any 12-month period.
Example Calculation
Suppose your home in Austin is worth $500,000 and your remaining mortgage is $300,000.
- Calculate 80% Cap: $500,000 x 0.80 = $400,000.
- Subtract Existing Debt: $400,000 – $300,000 = $100,000.
- Result: Your maximum HELOC limit in Texas would be $100,000.
How Rates are Determined in Texas
HELOC rates in Texas are typically variable and based on the Wall Street Journal Prime Rate. Lenders then add a "margin" based on your credit score and debt-to-income ratio. While the math is the same as in other states, the 80% LTV cap often helps Texas borrowers secure slightly better rates because the risk to the lender is lower due to the forced equity cushion.