HELOC Calculator
Estimate HELOC payments in both the draw and repayment periods.
Details
What you've actually borrowed
Payment during the draw period
$354.17
Total interest
$96,639
Total repaid
$146,639
This works out what a HELOC costs: the payments while you are drawing on it, and the higher payments once repayment begins.
Enter the amount drawn, the rate and both periods, and it returns each phase separately so the step up between them is visible before you commit.
HELOC vs home equity loan
Both a HELOC and a home equity loan let you borrow against the value you already own. The difference is in how the money arrives and how the rate behaves.
A home equity loan is a lump sum at a fixed rate with equal payments, like a second mortgage. A HELOC is a credit line you draw from as needed, usually at a variable rate, and you only pay interest on what you have actually used.
The choice follows the need. A single known cost, like a specific renovation quote, suits the lump sum. An unpredictable or staged cost suits the line of credit.
The payment jumps sharply at the transition, because you stop paying interest only and start repaying the balance as well. That step is what catches people out.
What to enter
- Amount drawn
- How much of the line you have actually used. Interest is charged on this, not on the full credit limit.
- Interest rate
- HELOC rates are usually variable, tied to the prime rate. They move when prime moves, which can be several times in a year.
- Draw period
- How long you can keep borrowing, commonly 10 years. Payments during this phase are often interest-only.
- Repayment period
- The phase after, commonly 20 years, when you repay principal as well and can no longer draw.
HELOC or home equity loan?
- Rate
- HELOC is usually variable and can rise. Home equity loan is fixed for the whole term.
- How you receive it
- HELOC is a line you draw from as needed. Home equity loan is a single lump sum at closing.
- Interest charged on
- HELOC charges only what you have drawn. A home equity loan charges the full amount from day one.
- Payments
- HELOC payments vary and step up after the draw period. Home equity loan payments are identical every month.
- Best for
- HELOC for staged or uncertain costs. Home equity loan for a single known amount where you want payment certainty.
What this assumes
The rate is treated as constant. Real HELOC rates move with prime, so payments during a long draw period will change.
Both are secured on your home. Missing payments risks foreclosure, which is the essential difference from unsecured borrowing.
How to calculate HELOC payments
Work out each phase separately, because they behave very differently.
- draw phase
- Interest only, so nothing reduces the balance
- repayment
- Principal and interest over the remaining term
Work out how much you can borrow. Lenders usually cap total borrowing at 80-85% of the home's value, minus what you already owe.
Calculate the draw-period payment. Balance times the monthly rate. Interest-only, so the balance does not fall.
Calculate the repayment-period payment. The same balance amortised over the repayment term. This is where the jump happens.
Check you can afford the second figure. It is the one that matters. Affording the draw payment tells you very little.
See a worked example: how much you can borrow on a $400,000 home
- Home value
- $400,000
- Owed on first mortgage
- $250,000
Your equity is $400,000 − $250,000 = $150,000.
But lenders cap total borrowing against the home. At 85%: $400,000 × 0.85 = $340,000.
Subtract the existing mortgage: $340,000 − $250,000 = $90,000 available.
At a stricter 80% cap it would be $70,000. So you can rarely borrow your full equity, which surprises most people.
About $90,000 at an 85% cap
Frequently asked questions
A home equity loan gives you a lump sum at a fixed rate with equal payments. A HELOC is a revolving credit line you draw from as needed, usually at a variable rate.
With a HELOC you pay interest only on what you have drawn. With a home equity loan you pay on the whole amount from day one, even if you have not spent it yet.
Pick the loan for a single known cost and payment certainty. Pick the line for staged or uncertain spending.
Most lenders cap total borrowing against the home at 80-85% of its value, including your existing mortgage.
On a $400,000 home with $250,000 owed, an 85% cap leaves about $90,000. You have $150,000 of equity, but you cannot borrow all of it.
You can no longer draw, and payments switch from interest-only to principal and interest. The payment can double or more.
This is the single biggest risk with a HELOC and it arrives on a known date, typically ten years in. Check the repayment-period figure before you borrow, not when it starts.
Usually not. Most are variable, tied to the prime rate, so payments rise when rates rise.
Some lenders let you convert part of the balance to a fixed rate. If payment certainty matters to you, a home equity loan may fit better than trying to manage that.
In the US, only when the funds are used to buy, build or substantially improve the home securing the loan, and limits apply.
Using a HELOC to consolidate credit cards or fund a holiday generally does not qualify. Check current IRS guidance or an accountant, since the rules have changed more than once.
Problems people actually run into
Affording the draw payment but not the repayment payment
Interest-only payments during the draw period are low and comfortable, which makes it easy to borrow more than is sustainable.
When repayment begins, the same balance must be repaid over a shorter remaining term, and the payment often doubles. Work out that figure first and treat it as the real cost of the loan.
Using home equity for spending rather than investment
A HELOC turns unsecured spending into debt secured on your house. Consolidating credit cards lowers the rate, but it also means a missed payment now risks your home rather than your credit score.
It can still be the right move, but the risk has genuinely changed and that trade deserves a deliberate decision.
Results are estimates for general information only and are not professional financial, medical, or legal advice. Read our full disclaimer.
Last updated: September 4, 2026