HELOC Borrowing Power Calculator
Estimate how much equity you can access from your home.
70%
75%
80% (Standard)
85%
90% (High)
Total Home Equity:
Maximum Combined Loan Limit:
Estimated HELOC Limit:
Estimated Monthly Interest (Draw Period):
How a HELOC Calculator Works
A Home Equity Line of Credit (HELOC) is a revolving line of credit secured by your home. Unlike a standard home equity loan, a HELOC allows you to borrow as much or as little as you need up to a specific limit, repay it, and borrow again during the "draw period."
The HELOC Formula
Lenders typically use a Combined Loan-to-Value (CLTV) ratio to determine your borrowing limit. The calculation used in this tool is:
(Home Value × CLTV Percentage) − Current Mortgage Balance = Available HELOC
For example, if your home is worth $500,000 and your lender allows an 80% CLTV, your total borrowing capacity is $400,000. If you still owe $300,000 on your primary mortgage, your HELOC limit would be $100,000.
Key Factors Influencing Your HELOC
- Current Market Value: Higher appraisals lead to higher credit limits.
- CLTV Ratio: Most lenders cap the total debt (mortgage + HELOC) at 80% to 85% of the home's value.
- Credit Score: A higher credit score often unlocks lower interest rates and higher CLTV limits.
- Debt-to-Income (DTI) Ratio: Lenders evaluate your ability to make monthly payments based on your gross income.
HELOC Draw vs. Repayment Period
During the draw period (usually 10 years), you often only have to pay interest on the amount you actually borrow. After the draw period ends, you enter the repayment period (usually 20 years), where you must pay back both the principal and interest, significantly increasing your monthly payment.