Calculate your monthly payment and total interest on a home equity loan, and check your combined loan-to-value ratio.
Rates as of Q2 2025 (example)
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A home equity loan calculator estimates your monthly payment and total interest on a fixed-rate loan borrowed against the equity in your home — the difference between your home's value and what you still owe on your mortgage. It also calculates your available equity and combined loan-to-value (CLTV) ratio, which lenders use to decide how much you can borrow.
Available equity is your home value minus your existing mortgage balance. The combined loan-to-value (CLTV) ratio is your existing mortgage balance plus the new home equity loan amount, divided by your home value, expressed as a percentage — lenders typically set a maximum CLTV (often around 80-85%) for home equity loans. The monthly payment on the home equity loan itself is calculated using the standard amortization formula M = P × [r(1+r)n] / [(1+r)n − 1].
Example: For a $400,000 home with a $250,000 existing mortgage and a $50,000 home equity loan at an 8.5% interest rate (example rate — enter your actual rate) over 15 years, the available equity is $150,000, the combined loan-to-value ratio is 75%, and the monthly payment on the home equity loan would be roughly $493. (Note: all figures in this example are for illustration purposes only and do not represent actual rates or market conditions.)
A home equity loan is a separate, fixed-rate loan secured by your home, distinct from a HELOC (Home Equity Line of Credit), which works more like a revolving credit line with a variable rate. Most lenders limit your combined loan-to-value (CLTV) ratio — the total of all loans secured by the home divided by its value — to around 80-85%, meaning the more equity you have, the more you may be able to borrow. Because the loan is secured by your home, rates are often lower than unsecured personal loans, but your home is at risk if you can't make payments (example rate used in this calculator — actual rates vary by lender and creditworthiness).
A home equity loan provides a lump sum with a fixed rate and fixed monthly payments, like a second mortgage. A HELOC (Home Equity Line of Credit) is a revolving credit line, typically with a variable rate, that you can draw from as needed.
CLTV is the total of your existing mortgage balance plus the new home equity loan, divided by your home's value. Lenders typically cap CLTV around 80-85% for home equity loans — a higher CLTV may mean a smaller loan amount or higher rate.
No — the default rate is an example only. Home equity loan rates vary based on your credit score, CLTV ratio, and the lender, and are typically higher than first-mortgage rates but lower than unsecured personal loan rates.
Available equity is your home's current value minus your existing mortgage balance. This represents the maximum theoretical equity you have, though lenders will only let you borrow up to a percentage of this based on their CLTV limits.
Because a home equity loan is secured by your home, failing to make payments could put your home at risk of foreclosure, similar to a primary mortgage. Only borrow amounts you're confident you can repay.
Yes — extra monthly payments reduce your principal balance faster, which lowers total interest paid and can help you pay off the loan ahead of schedule.
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. Financial rules and regulations change frequently. Always consult a qualified financial advisor or lender before making any financial decisions.