HELOC Calculator
Estimate your available home equity line of credit and interest-only payment.
How your available HELOC is calculated
A home equity line of credit (HELOC) is based on your home's value, your existing mortgage balance, and your lender's maximum combined loan-to-value (LTV) ratio, commonly 80-90%. This calculator multiplies your home value by the maximum LTV to find the total amount you could borrow against your home across all loans, then subtracts your existing mortgage balance to estimate how much HELOC credit line you could realistically qualify for.
Why HELOC payments are often interest-only during the draw period
Most HELOCs have two phases: a draw period, typically 10 years, where you can borrow against the line as needed and often pay interest-only on what you've drawn, and a repayment period afterward where the balance is amortized and you pay both principal and interest. This calculator estimates the interest-only monthly payment on your planned draw amount, which is usually far lower than a fully amortizing payment — but keep in mind your payment will rise once the repayment period begins and principal is added in.
What can you use a HELOC for?
Because a HELOC is a revolving line secured by your home, it's commonly used for home renovations, debt consolidation, education costs, or as an emergency fund, since you only pay interest on the amount you actually draw rather than the entire approved limit. Rates are usually variable, so your payment can change over time as market rates move, which is worth factoring in alongside the interest-only estimate shown here.
Frequently Asked Questions
How much HELOC can I qualify for?
Lenders typically allow a combined loan-to-value (existing mortgage plus new HELOC) of 80-90% of your home's value. Subtract your current mortgage balance from that maximum combined amount to estimate your available credit line, as shown in the calculator above.
Why is my HELOC payment interest-only?
Most HELOCs have a draw period, often 10 years, during which many lenders only require interest payments on the amount you've actually borrowed. This keeps payments low while you're actively using the line, but principal still needs to be repaid once the repayment period begins.
What happens when the draw period ends?
Once the draw period ends, most HELOCs enter a repayment period where the outstanding balance is amortized over a set number of years, meaning your payment increases since it now includes both principal and interest instead of interest alone.
Is a HELOC or a home equity loan better?
A HELOC is a revolving line of credit with a variable rate, letting you borrow and repay repeatedly, which suits ongoing or uncertain expenses. A home equity loan gives you a lump sum at a fixed rate with a fixed payment, which suits a one-time, known expense.
Does a HELOC use a fixed or variable interest rate?
Most HELOCs carry a variable interest rate tied to a benchmark like the prime rate, meaning your payment can rise or fall as market rates change. Some lenders offer the option to lock a portion of the balance into a fixed rate.
What can I use a HELOC for?
Common uses include home renovations, debt consolidation, education expenses, and emergency funds. Because your home secures the line, lenders generally don't restrict how you use the funds, but failing to repay puts your home at risk.
Is HELOC interest tax deductible?
Under current U.S. tax law, HELOC interest is generally only deductible if the funds are used to buy, build, or substantially improve the home securing the loan. Consult a tax professional to confirm how it applies to your specific situation.
What credit score do I need for a HELOC?
Most lenders look for a credit score of at least 620-680, along with sufficient home equity and a manageable debt-to-income ratio. Higher credit scores typically unlock better rates and higher maximum loan-to-value allowances.