HELOC Calculator
Estimate your maximum HELOC credit line from home value, mortgage balance, and LTV limit.
See available home equity and estimated monthly interest cost.
A Home Equity Line of Credit (HELOC) lets homeowners borrow against the equity they’ve built in their home. Unlike a fixed loan, a HELOC is a revolving credit line — similar to a credit card — with a variable interest rate and a set credit limit determined by your equity.
How the credit limit is calculated: Home Equity = Current Home Value − Outstanding Mortgage Balance Maximum HELOC = (Home Value × LTV Limit) − Mortgage Balance
Most lenders allow a combined Loan-to-Value (LTV) ratio of 80–85%, meaning total debt (mortgage + HELOC) cannot exceed 80–85% of the home’s appraised value.
Worked example:
- Home value: $420,000
- Remaining mortgage: $240,000
- Lender’s LTV limit: 85%
Maximum combined debt = $420,000 × 0.85 = $357,000 Maximum HELOC = $357,000 − $240,000 = $117,000
Monthly interest payment during draw period: Monthly Interest = (Balance × Annual Rate) / 12
On a $50,000 draw at 8.5% APR: Monthly interest = ($50,000 × 0.085) / 12 = $354.17/month
Two phases of a HELOC:
- Draw period (typically 10 years): You borrow as needed, pay interest only
- Repayment period (typically 10–20 years): No more draws; pay principal + interest
Key risks:
- HELOC rates are variable — tied to the prime rate — so payments rise when rates rise
- Your home is the collateral; default can result in foreclosure
- Some HELOCs have annual fees, inactivity fees, or early closure penalties
HELOCs work best for ongoing expenses like home renovations, not lump-sum needs (use a home equity loan instead for those).