HELOC Payment Calculator
Estimate your monthly interest-only payments and Combined Loan-to-Value (CLTV) ratio.
How to Use the HELOC Payment Calculator
A Home Equity Line of Credit (HELOC) is a revolving line of credit secured by your home. Unlike a traditional home equity loan, you only pay interest on the amount you actually draw. This calculator helps you understand the costs during the "draw period," which is typically the first 10 years of the loan when most lenders allow interest-only payments.
Understanding Your Results
Combined Loan-to-Value (CLTV): Lenders typically look for a CLTV of 85% or lower. This is calculated by adding your current mortgage balance to your HELOC limit and dividing it by your home's appraised value. For example, if your home is worth $500,000 and your total debt is $400,000, your CLTV is 80%.
Interest-Only Payment: During the draw period, your minimum payment is often just the interest. This is calculated as: (Balance × Interest Rate) ÷ 12 months. Keep in mind that once the draw period ends, you must begin paying back both principal and interest, which will significantly increase your monthly payment.
Realistic Example
Imagine your home is worth $400,000. You owe $200,000 on your first mortgage and decide to take out a $50,000 HELOC at a 9% interest rate.
- Your CLTV would be 62.5% ($250,000 / $400,000).
- Your monthly interest-only payment would be approximately $375.00 ($50,000 × 0.09 / 12).