HELOC Calculator

Calculate your available home equity, HELOC borrowing limit, interest-only payment during the draw period, and fully amortized payment during repayment. Understand the full cost of a home equity line of credit before you borrow.

Your Home Equity

Current Home Value ($)

Remaining Mortgage Balance ($)

Max LTV Allowed (%)

HELOC Terms

Amount to Borrow ($)

Annual Interest Rate (%)

Draw Period (years)

Repayment Period (years)

HELOC Payment Estimate

              Available HELOC Limit
              —
            

              Draw Period Payment (interest-only)
              —
            

              Repayment Period Payment
              —
            

Available Equity —

Total Interest Cost —

Payment Increase at Repayment —

Understanding HELOCs: Draw Period vs. Repayment Period

A Home Equity Line of Credit (HELOC) is one of the most flexible ways to borrow against your home's equity. The HELOC calculator helps you understand both phases — the draw period when you access funds, and the repayment period when you pay it back — so there are no surprises when the bill arrives.

How a HELOC Works

During the draw period (typically 5–10 years), you can borrow up to your approved credit limit, repay, and borrow again — similar to a credit card. Payments during this phase are usually interest-only, which keeps monthly costs low. During the repayment period (typically 10–20 years), the line closes and you pay back the full outstanding balance with interest. This payment shock is the most common HELOC planning mistake.

How Much Can You Borrow?

Lenders use a Combined Loan-to-Value (CLTV) ratio — typically 80–90% — to determine your maximum HELOC. The formula: (Home Value × max LTV%) − Outstanding Mortgage = Maximum HELOC. For a $400,000 home with a $220,000 mortgage at 85% LTV: ($400,000 × 0.85) − $220,000 = $120,000 available.

HELOC vs. Home Equity Loan

A HELOC offers flexibility — borrow only what you need, when you need it — but usually carries a variable rate tied to the prime rate. A home equity loan delivers a lump sum at a fixed rate with predictable payments. HELOCs are better for ongoing expenses like renovation projects; home equity loans suit one-time large purchases where you want payment certainty.

Tax Deductibility

HELOC interest may be tax deductible when funds are used to substantially improve the property securing the loan. The 2017 Tax Cuts and Jobs Act eliminated deductibility for other uses (debt consolidation, tuition, etc.). If you plan to use funds for home improvement, keep detailed records; consult a tax professional for your specific situation.

Risks to Consider

HELOCs are secured by your home — defaulting puts your home at risk. Variable rates mean payments can rise if the prime rate increases. Plan for the repayment-period payment jump by calculating it now (this calculator does that). If you can't comfortably handle the repayment payment, borrow less or choose a home equity loan with fixed payments instead.

Frequently Asked Questions

What is a HELOC and how does it work?

A HELOC is a revolving credit line secured by your home equity. During the draw period you borrow as needed and pay interest only. During the repayment period you can no longer draw and make principal + interest payments until paid off.

How much can I borrow with a HELOC?

Lenders allow up to 80–90% of home value minus your mortgage balance. On a $400,000 home with a $200,000 mortgage at 85% LTV: ($400,000 × 0.85) − $200,000 = $140,000 available.

Is HELOC interest tax deductible?

Only if used to buy, build, or substantially improve the home securing the HELOC. Interest on funds used for other purposes is generally not deductible. Keep detailed records and consult a tax professional.

What is the difference between a HELOC and a home equity loan?

A HELOC is revolving and usually variable rate — borrow as needed. A home equity loan is a fixed lump sum at a fixed rate with predictable payments. HELOCs suit ongoing expenses; home equity loans suit one-time large purchases.

What happens at the end of the HELOC draw period?

Borrowing stops and repayment begins. Monthly payments jump significantly because they now include principal. Plan for this payment increase by calculating it before you open the HELOC — this calculator shows both phases.