Estimate your available credit line and monthly payments during the draw period.
Please enter valid positive numbers for all fields.
Maximum Available Credit Line:
Monthly Payment (Interest-Only Period):
Monthly Payment (Repayment Period):
Remaining Equity after Max HELOC:
Understanding How Your HELOC Payment is Calculated
A Home Equity Line of Credit (HELOC) is a revolving credit line secured by your home. Unlike a standard home equity loan, which provides a lump sum, a HELOC allows you to borrow as needed, much like a credit card.
The Two Phases of a HELOC
Most HELOCs consist of two distinct periods:
The Draw Period: Typically 5 to 10 years. During this time, you can borrow money up to your limit. Most lenders only require interest-only payments on the amount you have actually borrowed.
The Repayment Period: Typically 10 to 20 years. Once the draw period ends, you can no longer borrow money. Your monthly payment increases significantly because you must now pay back both the principal balance and the interest over the remaining term.
What is LTV and CLTV?
LTV stands for Loan-to-Value. Lenders use Combined Loan-to-Value (CLTV) to determine how much you can borrow. If your home is worth $500,000 and the lender allows an 80% CLTV, the total of your first mortgage and your HELOC cannot exceed $400,000.
Example Calculation
Suppose your home is worth $400,000 and you owe $200,000 on your mortgage. If a lender allows an 85% CLTV:
Total Allowed Debt: $400,000 x 0.85 = $340,000
Minus Existing Mortgage: $340,000 – $200,000 = $140,000 Max HELOC
If you draw $50,000 at an 8% interest rate, your interest-only monthly payment would be approximately $333.33.
Variables to Watch
Most HELOCs have variable interest rates tied to the Prime Rate. This means if interest rates rise, your monthly payment will increase, even if you don't borrow more money. Always check for "caps" on how high your rate can go.