HELOC Calculator
Estimate your available home equity line of credit, the interest-only payment during the draw period, and the higher payment once repayment begins.
Written by Rahman · Last reviewed
Quick answer
On a $400,000 home with a $220,000 mortgage and an 80% maximum combined loan-to-value, the available line is $100,000, and at 9% that is $750 a month interest-only during the draw period against $899.73 a month once it amortizes over a 20-year repayment. A HELOC is an open-end line of credit secured by your home and sized against your equity. Most have a draw period of around 10 years where payments are often interest-only, then a repayment period where the payment switches to clearing the full balance. That jump is the part people are least prepared for.
During the 10-year draw period most HELOCs require interest-only payments on whatever balance is drawn — shown here assuming the full line is drawn and stays drawn. Once the repayment period begins, the payment switches to amortizing the balance over the repayment term, which is commonly a significant jump from the draw-period payment.
Results are estimates for general guidance and are not financial, tax or legal advice. Except where a calculator names a currency, figures carry no currency of their own: put in pounds and you get pounds back, put in rupees and you get rupees. Figures depend on the assumptions you enter and on rates that change over time. Check current rates and speak to a qualified adviser before acting on them.
About the HELOC Calculator
A home equity line of credit is a revolving, open-end line of credit secured by your home, similar in structure to a credit card, but backed by your equity rather than unsecured. Your equity is your home's current value minus whatever you still owe on your mortgage, and lenders will only let you borrow up to a set share of that value, combined across your mortgage and the new line.
This calculator estimates the credit line a lender might offer from your home value, mortgage balance and their maximum combined loan-to-value (CLTV), then shows two payments: an interest-only estimate for the draw period, and an amortizing estimate for the repayment period, the two phases every HELOC moves through.
Credit line = (Home value × max CLTV%) − Mortgage balance. Draw-period payment ≈ Credit line × (rate ÷ 12), assuming the full line is drawn and held. Repayment-period payment amortizes the credit line over the repayment term at the given rate, the same formula used for a standard fixed-rate loan.
Real HELOCs almost always carry a variable rate that can change during both the draw and repayment periods, and most borrowers do not draw the full line immediately; this is a planning estimate assuming the full line balance, not a lender's actual offer.
Two very different phases, one line of credit
A HELOC is not a single fixed payment the way a mortgage or a home equity loan is: it moves through two phases with different rules. During the draw period, commonly around 10 years, you can borrow against the line as needed, up to the limit, similar to a credit card. Minimum payments during this phase are often based on the current balance and are frequently interest-only, meaning the balance drawn does not shrink unless you choose to pay more than the minimum.
Once the draw period ends, the repayment period begins (often 10 or 20 years) and the lender sets a schedule to fully repay whatever balance remains. The payment switches from interest-only to amortizing, which is why it is often significantly higher than what was paid during the draw period. Borrowers who only ever paid the interest-only minimum face the largest jump, since none of the principal was reduced beforehand.
- The draw-period figure here assumes the full credit line is drawn and stays drawn; a partial draw produces a smaller interest-only payment.
- The repayment-period figure assumes the same balance carries straight into repayment with no further principal paid down during the draw period.
- Real HELOCs usually have a variable interest rate, so both the draw-period and repayment-period payments can move over time even without drawing more.
HELOC versus a home equity loan or a cash-out refinance
A HELOC's open-end, draw-as-needed structure is its main distinction from a home equity loan, which disburses a single fixed amount upfront and repays it on a fixed schedule from day one, closer to what this calculator's repayment-period figure models on its own. A HELOC is often a better fit for costs that arrive over time or are uncertain in size, such as a phased renovation; a home equity loan or cash-out refinance suits a single known cost better, since both avoid the payment jump a HELOC's repayment period creates.
Frequently Asked Questions
What is combined loan-to-value (CLTV)?
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It is your mortgage balance plus the new credit line, divided by your home value. Lenders cap this combined figure (commonly around 80%, though it varies by lender) rather than lending against 100% of your equity.
Why is the repayment-period payment so much higher?
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Because the draw-period minimum is often interest-only, none of the balance is reduced by making just the minimum payment. The repayment-period payment has to cover both interest and enough principal to fully retire the balance within the repayment term, which is a materially larger monthly amount on the same balance.
Does a HELOC have a fixed interest rate?
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Usually not. Most HELOCs carry a variable rate that can rise or fall over the life of the line, in both the draw and repayment periods. Some lenders offer a fixed-rate option on some or all of the balance; check your specific offer rather than assuming either way.
Do I have to draw the full credit line?
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No. A HELOC is open-end, so you draw only what you need, when you need it, up to the limit. This calculator estimates the draw-period payment assuming the full line is drawn, which is the highest that payment could be; drawing less produces a smaller interest-only payment.
Sources
- CFPB — What is a home equity line of credit (HELOC)? — US regulator explaining the draw period, repayment period and variable-rate structure of a HELOC.