Calculate Mortgage

.calc-container {
font-family: -apple-system, BlinkMacSystemFont, “Segoe UI”, Roboto, Oxygen-Sans, Ubuntu, Cantarell, “Helvetica Neue”, sans-serif;
max-width: 800px;
margin: 20px auto;
padding: 25px;
border: 1px solid #e0e0e0;
border-radius: 8px;
background-color: #f9f9f9;
color: #333;
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.calc-header {
text-align: center;
margin-bottom: 30px;
}
.calc-grid {
display: grid;
grid-template-columns: 1fr 1fr;
gap: 20px;
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@media (max-width: 600px) {
.calc-grid { grid-template-columns: 1fr; }
}
.input-group {
margin-bottom: 15px;
}
.input-group label {
display: block;
font-weight: 600;
margin-bottom: 8px;
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color: white;
padding: 15px;
border: none;
border-radius: 4px;
font-size: 18px;
font-weight: bold;
cursor: pointer;
transition: background-color 0.3s;
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.calc-button:hover {
background-color: #005177;
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.results-container {
margin-top: 30px;
padding: 20px;
background-color: #fff;
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border-radius: 8px;
display: none;
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margin-top: 40px;
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padding-bottom: 10px;
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margin-top: 25px;
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.highlight-box {
background-color: #e7f3ff;
padding: 15px;
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margin: 20px 0;
}

Calculate your borrowing power and estimated monthly payments based on your home’s current value.

Understanding Home Equity Loans

A home equity loan, often referred to as a “second mortgage,” allows homeowners to borrow against the value of their property. The amount you can borrow is determined by the difference between your home’s current market value and the remaining balance on your primary mortgage.

Key Formula:
(Home Value × Max LTV%) – Current Mortgage Balance = Potential Loan Amount

How the Calculation Works

Lenders typically do not allow you to borrow 100% of your home’s value. Most lenders limit the Loan-to-Value (LTV) ratio to 80% or 85%. This means the sum of your first mortgage and your new home equity loan cannot exceed that percentage of the home’s appraised value.

Example Calculation

Suppose your home is worth $500,000 and you owe $300,000 on your mortgage. If a lender allows an 80% LTV:

• 80% of $500,000 = $400,000 (Maximum total debt allowed)
• $400,000 – $300,000 (Existing debt) = $100,000 (Max Home Equity Loan)

Home Equity Loan vs. HELOC

While both use your home as collateral, a Home Equity Loan provides a lump sum with a fixed interest rate and set monthly payments. A HELOC (Home Equity Line of Credit) works more like a credit card, where you have a revolving balance and variable interest rates.

Factors That Influence Your Rate

Beyond your equity, lenders will look at your Credit Score (typically 620+ required, 740+ for best rates) and your Debt-to-Income (DTI) ratio. If your DTI is over 43%, you may find it harder to qualify even with significant equity.

function calculateHomeEquity() {
// Get input values
var homeValue = parseFloat(document.getElementById(‘homeValue’).value);
var mortgageBalance = parseFloat(document.getElementById(‘mortgageBalance’).value);
var ltvLimit = parseFloat(document.getElementById(‘ltvLimit’).value) / 100;
var loanTerm = parseInt(document.getElementById(‘loanTerm’).value);
var interestRate = parseFloat(document.getElementById(‘interestRate’).value) / 100;
var loanAmountRequest = parseFloat(document.getElementById(‘loanAmountRequest’).value);
// Validation
if (isNaN(homeValue) || isNaN(mortgageBalance) || isNaN(interestRate) || isNaN(loanAmountRequest)) {
alert(“Please enter valid numerical values for all fields.”);
return;
}
// Calculations
var totalEquity = homeValue – mortgageBalance;
var maxTotalDebt = homeValue * ltvLimit;
var maxBorrowable = maxTotalDebt – mortgageBalance;
// Monthly payment calculation for the requested loan amount
// Formula: P = [r*PV] / [1 – (1 + r)^-n]
var monthlyRate = interestRate / 12;
var numberOfPayments = loanTerm * 12;
var monthlyPayment = 0;
if (maxBorrowable maxBorrowable) {
statusText = “Amount exceeds limit based on ” + (ltvLimit * 100) + “% LTV.”;
document.getElementById(‘loanStatus’).style.color = “#d32f2f”;
document.getElementById(‘paymentRow’).style.display = “none”;
} else {
statusText = “Approved (Based on Equity)”;
document.getElementById(‘loanStatus’).style.color = “#2e7d32”;
// Calculate Payment
if (monthlyRate === 0) {
monthlyPayment = loanAmountRequest / numberOfPayments;
} else {
monthlyPayment = (loanAmountRequest * monthlyRate) / (1 – Math.pow(1 + monthlyRate, -numberOfPayments));
}
document.getElementById(‘monthlyPayment’).innerText = formatter.format(monthlyPayment);
document.getElementById(‘paymentRow’).style.display = “flex”;
}
// Update UI
document.getElementById(‘totalEquity’).innerText = formatter.format(totalEquity);
document.getElementById(‘maxBorrowing’).innerText = formatter.format(maxBorrowable);
document.getElementById(‘loanStatus’).innerText = statusText;
document.getElementById(‘results’).style.display = “block”;
}