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HELOC Payment Calculator
This is your free HELOC payment calculator. Use it to estimate your monthly payment, understand borrowing limits, and see how factors like your APR and loan term affect the specifics of borrowing against your home’s equity.
Whether you’re planning a home renovation, managing ongoing expenses, or consolidating high-interest credit card debt, this tool helps you estimate your monthly payment on a revolving line of credit.
HELOC Payment Calculator
HELOC Payment Calculator
Estimate your monthly payment on a home equity line of credit (HELOC).
Home and Credit Line Details
Enter your home value, current mortgage balance, estimated APR, and the HELOC credit line amount you’re considering.
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Discover lenders offering competitive HELOC and home equity rates, flexible terms, and low fees.
Estimated HELOC Payment
This estimate assumes you’ll draw the full HELOC line amount and repay it over the repayment period you selected.
Highlights
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How Does a HELOC Work?
A HELOC allows you to borrow against the equity in your home as needed, similar to using a credit card but with much lower interest rates. It’s a revolving line of credit that typically includes two phases, a draw period, and a repayment period.
1. Draw Period
- Usually lasts between 5 and 10 years
- You can borrow up to your approved credit limit in multiple draws.
- Many lenders allow interest-only payments, which can lower the initial monthly payments.
2. Repayment Period
- Usually lasts much longer than the draw period, up to 30 years
- You can no longer draw from the line of credit.
- Your balance converts into a structured installment loan with required principal and interest payments.
A HELOC is secured by your home, which is why interest rates are most often lower than those of personal loans or credit cards. However, because it’s a form of home equity loan, you must have enough equity and a sufficient credit score to qualify for approval.
What Can You Use a HELOC For?
HELOCs are flexible and designed for both short- and long-term financial needs. Typical uses include the following options, plus more.
- Home Renovation or Major Purchases: Because HELOCs allow you to borrow, repay, and borrow again, they’re ideal for ongoing renovation projects, phased upgrades, or large purchases such as HVAC replacements or roof repairs.
- Debt Consolidation: Using a HELOC to pay off high-interest credit cards can significantly reduce monthly payments because HELOC APRs are often lower than unsecured options.
- Emergency or Unpredictable Expenses: HELOCs can provide access to equity funds for emergencies, medical events, or temporary income gaps, with caution. The best personal loans can be another source of funding for these needs.
How to Calculate HELOC Payments
While this calculator can estimate your monthly HELOC payments, it’s essential to understand what factors determine that amount. Among the following factors, also note that your credit score, history, and overall financial situation will also play a role.
- Loan amount: The portion of your credit line that you actually borrow
- Interest rate (APR): The cost of borrowing money. HELOCS can include variable or fixed rates.
- Repayment period: How long you choose to repay the amount borrowed
- Whether you’re in the draw or repayment period, if your lender allows interest-only payments to start.
How to Calculate Interest-Only Payments on a HELOC
If your lender and the terms of your agreement allow interest-only payments during the draw period, you could experience lower payments to start. However, if this is an option, it’s important to know that doing so can increase the cost of borrowing over the long term.
The formula to determine interest-only payments = (Borrowed amount × APR) ÷ 12
Example:
- HELOC balance: $50,000
- APR: 9%
- Monthly interest payment = (50,000 × 0.09) / 12
- Monthly payment ≈ $375
Expert Tip: How to Pay Off a HELOC FasterFrom our on-staff Certified Financial Educator: A HELOC loan can be a long-term commitment, and making small adjustments along the way can save significant amounts of money. However, before pursuing cost-saving steps, ensure that your line of credit doesn’t include an early payoff penalty, which is allowable in some states. Here’s how to speed up your payoff and save money:
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What Is the Payment on a $50,000 HELOC Loan?
Your payments on a $50,000 HELOC loan depend on several factors. Your interest rate, term length, creditworthiness, type of rate (fixed or variable), whether you make interest-only payments, and other stats will all affect your monthly payment amount.
Assuming a fixed rate and no interest-only payments, your line of credit payment on a $50,000 HELOC loan could look something like this:
| APR | Repayment Term | Estimated Monthly Payment |
| 8% | 10 years | ~$607 |
| 8% | 15 years | ~$507 |
| 10% | 20 years | ~$483 |
Is a HELOC a Second Mortgage?
Yes. A HELOC is considered a second mortgage because it is secured by your home and lives behind your primary mortgage. This means:
- Your home is collateral
- You must meet credit and income requirements
- Your approval depends heavily on your combined loan-to-value ratio (CLTV). Many lenders allow a CLTV of up to 80% or 85%.
HELOC Pros and Cons
A home equity line of credit can be one of the most flexible ways to borrow against the equity in your home. However, like any financial tool, there are both pros and cons. Here’s what to know:
Pros
- Borrow only what you need
- Interest-only payments are sometimes available during the draw period
- Potentially lower APR than credit cards or personal loans.
- Pay interest only on what you actually borrow.
- Temporarily acts as a reusable line of credit.
Cons
- Using your home as collateral increases your risk.
- Interest-only payments, if available, cost more over time.
- Origination fees and closing costs often apply.
- You may experience a temptation to overspend.
HELOC vs. Home Equity Loan
A HELOC is technically a home equity loan. However, a HELOC functions quite differently from a traditional home equity loan. Here’s what to know about each option:
HELOC
- A HELOC is a revolving credit line from which you can draw funds until your draw period ends.
- They can have variable or fixed interest rates, though many of the best HELOC providers are making fixed rates commonplace.
- Interest-only payments are sometimes allowed during the draw period.
Home Equity Loan
- Only a single lump-sum amount is available.
- Almost always come with a fixed interest rate
- Because a draw period doesn’t exist, your payment is fixed for the duration of the loan.
Frequently Asked Questions
Do HELOCs compound interest?
Yes. HELOCs generally accrue interest based on your average daily balance. That interest then compounds monthly. If your HELOC allows interest-only payments during the draw period, those payments cover only the accrued interest. Since your principal balance doesn’t decrease, interest keeps accumulating on the full amount you’ve borrowed. This can increase the total cost of borrowing and lead to a larger required payment once the repayment period begins.
Can you use a HELOC to pay off credit cards?
Many homeowners use a HELOC to consolidate high-interest credit card debt because their APRs are often much lower than typical credit card rates. This can reduce monthly payments and total interest paid. However, it’s essential to understand that by doing so, you’re converting unsecured debt into secured debt backed by your home. If you fall behind on payments, you could put yourself at risk of foreclosure and potentially lose your home.
Can a HELOC have a fixed rate?
HELOCs have long been known for having variable interest rates. However, many lenders, including several you’ll find on LendingTree, offer fixed-rate HELOCs, which can be much easier to budget for.
Conclusion
HELOCs offer a flexible way to borrow against the equity in your home. You can use the funds for many purposes, including debt consolidation, covering unexpected expenses, paying for home renovations, and more. They often come with significantly lower interest rates than other forms of borrowing because the debt is secured by your home.
Use the HELOC payment calculator above to estimate your monthly payments based on repayment periods, APR, and your loan amount. Learn more and discover providers to meet your needs in our overview of the best home equity and HELOC lenders.