Estimate your available Home Equity Line of Credit based on your home's value and current mortgage.
What is a HELOC?
A Home Equity Line of Credit (HELOC) is a revolving credit line secured by your home. It functions similarly to a credit card, allowing you to borrow against the equity in your property as needed, up to a certain limit. Because your home acts as collateral, HELOCs typically offer lower interest rates than personal loans or credit cards.
How Your HELOC Limit is Calculated
Lenders use a metric called the Combined Loan-to-Value (CLTV) ratio to determine how much you can borrow. Most lenders allow a CLTV of 80% to 90%. The formula is as follows:
(Home Value × CLTV Percentage) – Existing Mortgage Balance = Available HELOC
Example HELOC Scenarios
Home Value
Current Mortgage
CLTV Limit
Max HELOC Line
$300,000
$150,000
80%
$90,000
$500,000
$350,000
85%
$75,000
$750,000
$400,000
90%
$275,000
Factors That Affect Your HELOC Approval
Credit Score: A higher score often results in lower interest rates and higher CLTV limits.
Debt-to-Income (DTI) Ratio: Lenders want to ensure you have enough income to cover your new line of credit alongside existing debts.
Property Type: Investment properties or second homes may have lower borrowing limits compared to primary residences.
Appraisal: A professional appraisal will confirm the actual market value used in the calculation.
function calculateHELOC() {
var homeValue = parseFloat(document.getElementById('homeValue').value);
var mortgageBalance = parseFloat(document.getElementById('mortgageBalance').value);
var cltvLimit = parseFloat(document.getElementById('cltvLimit').value);
var resultBox = document.getElementById('helocResultBox');
var output = document.getElementById('helocOutput');
if (isNaN(homeValue) || isNaN(mortgageBalance) || isNaN(cltvLimit)) {
alert("Please enter valid numeric values for all fields.");
return;
}
if (cltvLimit > 100) {
alert("CLTV Ratio typically does not exceed 100%. Please check your input.");
return;
}
var decimalCltv = cltvLimit / 100;
var totalBorrowingCapacity = homeValue * decimalCltv;
var maxHeloc = totalBorrowingCapacity – mortgageBalance;
resultBox.style.display = "block";
if (maxHeloc <= 0) {
output.innerHTML = "Estimated HELOC Limit:$0" +
"Based on these numbers, you currently do not have enough equity to meet the lender's CLTV requirements.";
} else {
var formattedResult = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(maxHeloc);
var formattedTotalCap = new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(totalBorrowingCapacity);
output.innerHTML = "Estimated HELOC Limit:" + formattedResult + "" +
"Breakdown:" +
"Total Allowed Debt (" + cltvLimit + "% of Value): " + formattedTotalCap + "" +
"Minus Current Mortgage: -" + new Intl.NumberFormat('en-US', { style: 'currency', currency: 'USD' }).format(mortgageBalance) + "";
}
}