HELOC Payment & Equity Calculator
70% LTV
75% LTV
80% LTV
85% LTV
90% LTV
10 Years
15 Years
20 Years
Available Home Equity:
$0.00
Maximum HELOC Limit:
$0.00
Monthly Interest-Only Payment (Draw Period):
$0.00
Estimated Monthly P+I (Repayment Period):
$0.00
Understanding Your HELOC Payments
A Home Equity Line of Credit (HELOC) works differently than a standard home equity loan. It is a revolving line of credit secured by your home that typically consists of two distinct phases: the draw period and the repayment period.
How a HELOC is Calculated
Lenders determine your HELOC limit based on your combined loan-to-value (CLTV) ratio. Most lenders allow a CLTV of 80% to 85%. The formula is:
(Home Value × LTV %) - Current Mortgage Balance = Maximum HELOC Limit
Draw Period vs. Repayment Period
- Draw Period (Typically 10 years): During this time, you can borrow money as needed. Most HELOCs only require interest-only payments on the amount you have actually borrowed.
- Repayment Period (Typically 20 years): You can no longer borrow money. Your monthly payments increase significantly because you must now pay back both the principal balance and the interest over the remaining term.
Example Calculation
If your home is worth $500,000 and your lender allows an 80% LTV, they will allow total debt up to $400,000. If you still owe $300,000 on your primary mortgage, your maximum HELOC limit would be $100,000.
If you draw $50,000 at an 8% interest rate:
- Draw Period Payment: $50,000 × 0.08 / 12 = $333.33 per month (Interest Only).
- Repayment Period Payment: Amortized over 20 years, the payment would jump to approximately $418.22 per month (Principal + Interest).
Factors That Influence Your Rate
Unlike fixed-rate home equity loans, HELOCs usually have variable interest rates tied to the U.S. Prime Rate. This means your monthly payment can fluctuate even if you don't borrow more money. Factors affecting your specific rate include your credit score, the amount of equity in your home, and your debt-to-income ratio.