Calculate your HELOC draw-period interest-only payments and your repayment-period fully-amortized payments. See total interest over the life of your line of credit.
Input your home value, existing mortgage balance, the credit line amount you want, and the interest rate.
Enter the draw period (typically 10 years) and repayment period (typically 20 years) for your HELOC.
View your interest-only draw period payment, your full repayment period payment, and total interest over the life of the HELOC.
A HELOC (Home Equity Line of Credit) is a revolving line of credit secured by your home equity. Like a credit card, you can borrow, repay, and borrow again up to your limit during the draw period. Interest rates are typically variable and lower than personal loans.
A HELOC is revolving credit — you draw what you need. A home equity loan provides a lump sum upfront at a fixed rate. HELOCs have variable rates and interest-only payments during draw; home equity loans have fixed rates and fixed P+I payments from day one.
A HELOC has two phases. The draw period (typically 10 years) allows you to borrow and repay freely with interest-only monthly payments. The repayment period (typically 10-20 years) begins after the draw ends — no new borrowing, and you must repay the balance in equal P+I payments.
Most lenders allow you to borrow up to 80-85% of your home value minus your mortgage balance. For example, a $500K home with $300K mortgage balance: 80% of $500K = $400K, minus $300K balance = $100K maximum HELOC. Your credit score also affects the limit.
HELOC rates are typically variable, tied to the prime rate plus a margin. They change as the Federal Reserve changes interest rates. Some lenders offer the ability to convert a portion of your balance to a fixed rate. This introduces payment uncertainty — always budget for rate increases.
Yes, this is a common use. Using a HELOC at 7-9% to pay off credit card debt at 20%+ saves significant interest. However, you are converting unsecured debt into debt secured by your home. If you cannot repay, you risk losing your home — exercise caution.
Under current tax law, HELOC interest is only deductible if the funds are used to buy, build, or substantially improve the home securing the loan. Using a HELOC for personal expenses, debt consolidation, or investments does not qualify for the deduction.
When the draw period ends, you can no longer withdraw funds. The repayment period begins, and your monthly payment jumps significantly because you now pay both principal and interest on the full outstanding balance. Budget carefully for this transition.
