HELOC Calculator
A Home Equity Line of Credit (HELOC) lets you borrow against your home's equity at a variable interest rate, up to a credit limit based on your loan-to-value ratio. It functions like a credit card secured by your home: you draw what you need during a draw period (often 10 years) and pay interest only on the amount you've drawn, then enter a repayment period (often 10 to 20 years) when you pay principal and interest. This calculator estimates your available credit line based on your home's value, your current mortgage balance, and the maximum loan-to-value your lender allows, then estimates the monthly interest-only payment on the amount you plan to draw during the draw period. Enter your home's current value, your current mortgage balance, the maximum loan-to-value your lender allows, the HELOC APR, and the amount you plan to draw, and the calculator returns your available credit line, the interest-only monthly payment, and your remaining available credit. Most lenders allow a combined loan-to-value up to 80% to 85%, meaning your first mortgage plus the HELOC can total that fraction of your home's value. Because HELOC rates are typically variable and tied to the prime rate, your payment can rise when rates rise, so stress-test the payment at a higher rate before relying on the lower estimate. HELOC interest may be tax-deductible if the funds are used to buy, build, or substantially improve the home securing the loan, so consult a tax advisor. The key risk to remember is that your home secures the line — if you can't repay, you could face foreclosure — so a HELOC is best used for investments that build wealth (home improvements, education, or consolidating higher-rate debt) rather than for consumption that leaves you with debt and nothing to show for it.
HELOC Calculator
Estimate your home equity line of credit limit and the monthly interest-only payment.
Available credit line
$70,000
80% of home value
Monthly interest-only payment
$354
Remaining available
$20,000
A HELOC lets you borrow against home equity at a variable rate. During the draw period you often pay interest only; you must repay principal during the repayment period. Your home secures the line.
How to Use This Calculator
- 1Enter your home's current value.
- 2Enter your current mortgage balance.
- 3Enter the maximum loan-to-value your lender allows.
- 4Enter the HELOC APR.
- 5Enter the amount you plan to draw.
Why It Helps
- ✓Shows how much credit you can access.
- ✓Estimates the interest-only draw-period payment.
- ✓Helps you compare HELOCs to other borrowing.
- ✓Clarifies remaining available credit.
About This Calculator
A Home Equity Line of Credit (HELOC) lets you borrow against your home's equity at a variable interest rate, up to a credit limit based on your loan-to-value ratio. It functions like a credit card secured by your home: you draw what you need during a draw period (often 10 years) and pay interest only on the amount you've drawn, then enter a repayment period (often 10 to 20 years) when you pay principal and interest. This calculator estimates your available credit line based on your home's value, your current mortgage balance, and the maximum loan-to-value your lender allows, then estimates the monthly interest-only payment on the amount you plan to draw during the draw period. Enter your home's current value, your current mortgage balance, the maximum loan-to-value your lender allows, the HELOC APR, and the amount you plan to draw, and the calculator returns your available credit line, the interest-only monthly payment, and your remaining available credit. Most lenders allow a combined loan-to-value up to 80% to 85%, meaning your first mortgage plus the HELOC can total that fraction of your home's value. Because HELOC rates are typically variable and tied to the prime rate, your payment can rise when rates rise, so stress-test the payment at a higher rate before relying on the lower estimate. HELOC interest may be tax-deductible if the funds are used to buy, build, or substantially improve the home securing the loan, so consult a tax advisor. The key risk to remember is that your home secures the line — if you can't repay, you could face foreclosure — so a HELOC is best used for investments that build wealth (home improvements, education, or consolidating higher-rate debt) rather than for consumption that leaves you with debt and nothing to show for it.
Disclaimer: This calculator provides estimates for educational purposes only and does not constitute financial, tax, or investment advice. Results depend on assumptions that may not reflect your actual situation.
Frequently Asked Questions
What loan-to-value do HELOCs allow?
Most lenders allow a combined loan-to-value up to 80-85%, meaning your mortgage plus HELOC can total that fraction of your home's value.
Are HELOC rates fixed or variable?
Most HELOCs have variable rates tied to the prime rate. Some lenders let you convert part of the balance to a fixed rate.
What happens when the draw period ends?
You enter the repayment period (often 10-20 years) and must pay principal plus interest, which raises your monthly payment significantly.
Is HELOC interest tax-deductible?
Interest may be deductible if the funds are used to buy, build, or substantially improve the home securing the loan. Consult a tax advisor.
What is the risk of a HELOC?
Your home is collateral. If you can't repay, you could face foreclosure. Variable rates can also rise, increasing payments.
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Written by
James MitchellSenior Financial Analyst & Personal Finance Expert
Certified Financial Planner (CFP) • MBA in Finance, University of Chicago Booth School of Business