Estimate your maximum HELOC limit, available credit, and interest-only monthly payment on your draw amount.
Rates as of Q2 2025 (example — HELOC rates are usually variable)
A HELOC (Home Equity Line of Credit) calculator estimates how much you could potentially borrow against your home's equity, based on your home value, existing mortgage balance, and your lender's maximum combined loan-to-value (CLTV) limit. It also shows your available credit after a draw amount and an estimated interest-only monthly payment on that draw.
The maximum HELOC limit is calculated as your home value multiplied by the lender's maximum CLTV percentage, minus your existing mortgage balance. Your draw amount is subtracted from this limit to show your available credit. During the draw period, many HELOCs charge interest-only payments, calculated here as your draw amount multiplied by the annual interest rate, divided by 12.
Example: For a $400,000 home with a $250,000 existing mortgage and an 80% CLTV limit, the maximum HELOC limit would be $70,000 ($400,000 × 80% − $250,000). Drawing $30,000 of that at a 9% interest rate (example rate — HELOC rates are usually variable) would leave $40,000 in available credit and an estimated interest-only payment of roughly $225 per month. (Note: all figures in this example are for illustration purposes only and do not represent actual rates or market conditions.)
A HELOC works like a credit card secured by your home — you're approved for a credit limit and can draw, repay, and redraw funds during a "draw period" (often 10 years), typically followed by a repayment period where you pay down both principal and interest. HELOC interest rates are usually variable, often tied to a benchmark rate plus a margin, meaning your payment can change over time — the 9% rate used in this calculator is an example only and not a fixed or guaranteed rate. Lenders typically cap CLTV between 65% and 90% depending on your credit profile and the lender's policies.
It's your home value multiplied by your lender's maximum combined loan-to-value (CLTV) percentage, minus your existing mortgage balance. For example, an 80% CLTV on a $400,000 home with a $250,000 mortgage gives a maximum HELOC limit of $70,000.
HELOCs are typically tied to a benchmark interest rate plus a margin set by the lender. As the benchmark rate changes, so does your HELOC rate and payment — the 9% rate in this calculator is an example only and not fixed.
During the draw period, many HELOCs only require you to pay the interest on the amount you've drawn, calculated as your draw amount times the interest rate divided by 12. This payment does not reduce your principal balance.
After the draw period (often around 10 years), most HELOCs enter a repayment period where you can no longer draw funds and must repay both principal and interest, which typically increases your monthly payment significantly.
Combined loan-to-value (CLTV) is your existing mortgage balance plus your HELOC balance, divided by your home's value. Lenders cap CLTV (often between 65% and 90%) to limit their risk if home values decline.
A HELOC is a revolving credit line, typically with a variable rate, that you can draw from as needed. A home equity loan provides a lump sum upfront with a fixed rate and fixed monthly payments, like a second mortgage.
Disclaimer: The information, rates, and figures provided on this page are for educational and illustrative purposes only. All rates and examples shown are sample values and do not reflect current or actual market rates, which for HELOCs are usually variable and change over time. Financial rules and regulations change frequently. Always consult a qualified financial advisor or lender before making any financial decisions.