HELOC Calculator
Calculate Home Equity Line of Credit payments for draw and repayment periods
HELOC Details
Amount you plan to use or have already used from your HELOC
Period when you can access funds (typically 10-15 years)
Period to repay principal and interest (typically 10-20 years)
Annual interest rate (usually variable)
One-time fee charged when opening the HELOC
Yearly fee to keep the line of credit active
Interest Rate Adjustments
HELOC Payment Results
Note: During the draw period, you pay interest only on the amount used. During the repayment period, you pay principal plus interest.
HELOC Formula: Draw Period = Balance × Monthly Rate | Repayment = PMT calculation
HELOC Analysis
Example Calculation
Home Renovation HELOC
HELOC Balance: $50,000
Interest Rate: 5% APR
Draw Period: 10 years
Repayment Term: 20 years
Calculation Results
Monthly rate: 5% ÷ 12 = 0.417%
Draw period payment: $50,000 × 0.00417 = $208.33/month
Repayment payment: PMT formula = $329.98/month
Total interest over 30 years: $54,029
HELOC Phases
Draw Period
10-15 years typically
Access funds as needed, pay interest only
Repayment Period
10-20 years typically
Pay principal + interest, no new draws
HELOC Qualification
Home equity of at least 15-20%
Combined LTV ratio up to 80-85%
Credit score of 620+ (720+ for best rates)
Debt-to-income ratio under 43%
Stable employment and income
HELOC Tips
Use for home improvements to maintain tax deductibility
Make principal payments during draw period
Monitor interest rate changes closely
Compare closing costs and annual fees
Have a repayment plan before borrowing
Understanding HELOCs
What is a HELOC?
A Home Equity Line of Credit (HELOC) is a revolving credit line secured by your home's equity. Unlike a traditional loan, you can borrow, repay, and borrow again during the draw period, paying interest only on the amount you use.
How HELOCs Work
- •Access funds up to your credit limit during draw period
- •Pay interest only on the amount you borrow
- •Variable interest rates typically tied to prime rate
- •Repayment period requires principal + interest payments
HELOC vs Home Equity Loan
HELOC
Revolving credit line, variable rate, interest-only payments during draw period
Home Equity Loan
Lump sum loan, fixed rate, fixed monthly payments from start
HELOC Loan Amount
HELOC Amount = (Home Value × 80%) - Mortgage Balance
Most lenders allow up to 80% combined loan-to-value (CLTV) ratio
Interest Rate Risk
Variable rates can increase significantly over time, affecting your monthly payments and total cost.
Payment Shock
Repayment period payments can be much higher than draw period payments if you only paid interest.
Foreclosure Risk
Your home secures the HELOC. Failure to make payments could result in foreclosure.