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HELOC (Home Equity Line of Credit) Calculator

Typically 80% to 90%
Estimated Maximum HELOC Limit:
Monthly Interest-Only Pmt (at full draw):
Total Combined Debt (CLTV):

Understanding Your HELOC Calculation

A Home Equity Line of Credit (HELOC) is a revolving line of credit that uses your home as collateral. Unlike a home equity loan, which provides a lump sum, a HELOC allows you to withdraw funds as needed, up to a specific limit determined by your equity.

How the Max Limit is Calculated

Lenders use the Combined Loan-to-Value (CLTV) ratio to determine your borrowing power. The formula used in this calculator is:

Max HELOC = (Home Value × Max CLTV%) – Current Mortgage Balance

Key Terms to Know

  • Home Value: The current market appraisal of your property.
  • CLTV: Most lenders allow a maximum of 80% to 85% CLTV. If your home is worth $500k and the limit is 80%, your total debt (mortgage + HELOC) cannot exceed $400k.
  • Draw Period: The timeframe (usually 10 years) during which you can borrow money and often make interest-only payments.
  • Repayment Period: The phase (usually 15-20 years) where you must pay back both principal and interest.

Practical Example

Suppose your home is valued at $400,000 and you owe $250,000 on your primary mortgage. If your lender allows an 85% CLTV:

  1. $400,000 x 0.85 = $340,000 (Maximum total allowable debt).
  2. $340,000 – $250,000 = $90,000 (Your maximum HELOC limit).

With an interest rate of 8%, your monthly interest-only payment if you used the full $90,000 would be approximately $600.00.

function calculateHeloc() { var homeValue = parseFloat(document.getElementById('homeValue').value); var currentMortgage = parseFloat(document.getElementById('currentMortgage').value); var cltvLimit = parseFloat(document.getElementById('cltvLimit').value) / 100; var helocRate = parseFloat(document.getElementById('helocRate').value) / 100; if (isNaN(homeValue) || isNaN(currentMortgage) || isNaN(cltvLimit) || isNaN(helocRate)) { alert("Please enter valid numeric values for all fields."); return; } // Calculation: (Home Value * CLTV Ratio) – Mortgage Balance var maxTotalDebt = homeValue * cltvLimit; var maxHelocLimit = maxTotalDebt – currentMortgage; // Handle negative equity scenarios if (maxHelocLimit < 0) { maxHelocLimit = 0; } // Interest only payment calculation: (Balance * Rate) / 12 var monthlyInterestOnly = (maxHelocLimit * helocRate) / 12; // Formatting numbers var formatter = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD', minimumFractionDigits: 0, maximumFractionDigits: 0 }); var paymentFormatter = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD', minimumFractionDigits: 2, maximumFractionDigits: 2 }); // Display Results document.getElementById('helocResult').style.display = 'block'; document.getElementById('maxLimitOutput').innerText = formatter.format(maxHelocLimit); document.getElementById('interestOnlyPayment').innerText = paymentFormatter.format(monthlyInterestOnly); document.getElementById('totalDebtOutput').innerText = formatter.format(maxTotalDebt); // Smooth scroll to result document.getElementById('helocResult').scrollIntoView({ behavior: 'smooth', block: 'nearest' }); }

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