How to use this HELOC calculator
- Enter your home value and mortgage balance. Include any other loans secured by the home. A lender will use an appraisal or its own estimate of value, so yours may differ.
- Set the maximum combined loan-to-value. The 80% default is an assumption, not a rule. Lenders set their own limit, so use the one from your offer.
- Enter the amount you want to borrow and choose the loan. Pick a HELOC, which is a line of credit, or a home equity loan, which is a single lump sum.
- Enter your rate and periods. A 10-year draw and a 20-year repayment are typical defaults, not universal terms. The rate is an example until you enter your own.
- Read the rate-rise test. It reruns the same loan with a higher rate, so you can see whether the payment would still fit your budget.
How the numbers are worked out
Most you could borrow = Home value × Maximum CLTV − Mortgage balanceCombined LTV = (Mortgage balance + Amount borrowed) ÷ Home valueDraw payment = Balance × Rate ÷ 12Repayment payment = Balance × m ÷ (1 − (1 + m)−n) m is the monthly rate (rate ÷ 12) and n is the number of months in the repayment period.
The HELOC figures rest on four assumptions. You draw the full amount on day one. You pay interest only during the draw period, which some plans allow, while others require some principal too. You don't borrow again. And the rate stays the same for the whole loan, which a variable rate rarely does. Fees aren't included. Treat every result as an estimate.
Worked example
Your home is worth $450,000 and you owe $250,000. At an 80% limit, all loans on the home can reach $360,000, so the most you could borrow is $110,000. You borrow $50,000, which takes your combined loan-to-value to 66.7%.
At an example rate of 8%, the interest-only payment is $333.33 a month. Over the 10-year draw period you pay $40,000 in interest, and you still owe the full $50,000.
The 20-year repayment period then starts. Your payment rises to $418.22, a jump of $84.89 a month, or 25%. You pay another $50,373 in interest, for a total of $90,373 over 30 years.
Now test a rise of 2 points. At 10%, you would pay $416.67 during the draw and $482.51 during repayment. Total interest would be $115,803, which is $25,430 more.
The 8% rate is only an example. It equals the bank prime loan rate of 7.00%, as published by the Federal Reserve on October 30, 2026, plus a 1-point margin. Prime is one common HELOC index, and your margin depends on your lender.
How much you could borrow at different limits
Lenders set their own maximum, so it helps to see how much it matters. On the same $450,000 home with a $250,000 mortgage, each 5 points adds $22,500 to what you could borrow:
| Maximum combined LTV | All loans can reach | Most you could borrow |
|---|---|---|
| 75% | $337,500 | $87,500 |
| 80% | $360,000 | $110,000 |
| 85% | $382,500 | $132,500 |
| 90% | $405,000 | $155,000 |
Borrowing the maximum isn't the same as being able to afford it. At 80%, the full $110,000 would cost $733.33 a month during the draw and $920.08 during repayment at an 8% rate.
HELOC payments by amount borrowed
This table uses an 8% example rate, a 10-year interest-only draw and a 20-year repayment period.
| Amount borrowed | Draw payment | Repayment payment | Payment jump | Total interest |
|---|---|---|---|---|
| $25,000 | $166.67 | $209.11 | +$42.44 | $45,186 |
| $50,000 | $333.33 | $418.22 | +$84.89 | $90,373 |
| $75,000 | $500.00 | $627.33 | +$127.33 | $135,559 |
| $100,000 | $666.67 | $836.44 | +$169.77 | $180,746 |
Why the repayment period matters so much
A shorter repayment period costs less interest, but it makes the payment jump far bigger. The CFPB says lenders often set a schedule of 10 or 20 years. Here is $50,000 at 8%, after a 10-year draw:
| Repayment period | Repayment payment | Payment jump | Payment at 10% | Total interest |
|---|---|---|---|---|
| 10 years | $606.64 | +$273.30 (82%) | $660.75 | $62,797 |
| 15 years | $477.83 | +$144.49 (43%) | $537.30 | $76,009 |
| 20 years | $418.22 | +$84.89 (25%) | $482.51 | $90,373 |
Paying some principal during the draw period shrinks the jump, because you have a smaller balance when repayment begins. If you can afford more than the minimum, the debt payoff calculator can help you plan it alongside your other debts.
HELOC or home equity loan?
| HELOC | Home equity loan | |
|---|---|---|
| Rate | Usually variable | Usually fixed |
| How you get the money | Borrow as you need it, up to your limit | One lump sum |
| Payments | Can change, and often rise in repayment | Equal payments that pay off the loan |
| If you need more | Draw again during the draw period | Apply for a new loan |
| Is your home at risk? | Yes | Yes |
On the same $50,000 at the same 8%, a 15-year home equity loan costs $477.83 a month from the start, with $36,009 in total interest. The HELOC above starts lower, but it runs twice as long and costs $90,373. Real offers will have different rates, so enter each one. If you are also thinking about replacing your first mortgage, compare a cash-out loan with the refinance calculator.
The risks to understand first
- Your home is the collateral. If you fall behind or can't repay on schedule, you could lose your home. Only borrow what you are confident you can repay, even if your income drops.
- The rate can rise. A variable rate is usually an index, such as the prime rate, plus a margin. Your payment can change even if you borrow nothing more. Federal rules require these plans to state a maximum rate, so ask what yours is.
- The payment can jump. Payments are often significantly higher once repayment starts, and the rate may be higher by then too.
- You may face a balloon payment. Some plans require the entire balance when the draw period ends. If you can't pay or refinance it, you could lose your home.
- A low first rate may not last. Lenders sometimes offer an introductory rate for a short time, such as six months.
- Your line can shrink. HELOCs generally let the lender freeze or reduce your line if your home's value falls or your finances get worse.
- Selling means paying it off. You are generally required to pay off a HELOC in full when you sell the home.
- There can be costs. These can include an application fee, an appraisal, closing costs and annual fees. Federal law generally gives you three days to cancel after the account opens.
Is home equity interest tax deductible in 2026?
Only in some cases. The IRS says interest on home equity loans and lines of credit is deductible only if the money is used to buy, build or substantially improve the home that secures the loan. The loan must be secured by your main home or second home, and you need to itemize.
The limit is $750,000 of mortgage debt in total ($375,000 if married filing separately), across your main home and second home. A higher limit of $1 million ($500,000) applies to debt taken on before December 16, 2017. These rules were due to expire after 2025, but the 2025 tax law (Public Law 119-21, section 70108) kept them for tax years from 2026 onward.
So interest on a HELOC used for a new roof or an addition may qualify. Interest on a HELOC used to pay off credit cards or buy a car doesn't. Keep records of how you spent the money. This page is for education, not tax advice, so check IRS Publication 936 or a tax professional for your situation.
To check where you stand before you apply, use the LTV calculator. To see your first mortgage on its own, try the mortgage calculator.
Frequently asked questions
How much can I borrow with a HELOC?
What is the monthly payment on a $50,000 HELOC?
What happens when the HELOC draw period ends?
Is HELOC interest tax deductible in 2026?
Is a HELOC or a home equity loan better?
Can a lender freeze my HELOC?
What is combined loan-to-value?
Sources and further reading
Independent, official guidance on this topic. Rules differ by country, so check the regulator where you live.
- What is a home equity line of credit (HELOC)? · Consumer Financial Protection Bureau
- What you should know about home equity lines of credit · Consumer Financial Protection Bureau
- Publication 936, Home Mortgage Interest Deduction · Internal Revenue Service
- H.15 Selected Interest Rates · Federal Reserve
This calculator gives estimates for education and planning. It is not financial advice, and your lender's figures may differ. See how we calculate.