Formulas and 2026 figures checked & updated: July 2026
Your Home
Loan Details
Max available at 80% CLTV: $70,000
Equity & Payment Summary
How to Use the Home Equity Loan & HELOC Calculator
- Enter your home's current market value and your remaining mortgage balance.
- Review your calculated home equity — the difference between the two.
- See your maximum borrowing limit, which this calculator caps at 80% combined loan-to-value (CLTV).
- Enter how much you want to borrow, up to that maximum.
- Enter the interest rate and loan term you expect to qualify for.
- Review your fixed monthly payment and total interest for the loan amount you chose.
- Compare the monthly payment to your budget and to alternatives like a cash-out refinance. Example: a $500,000 home with a $300,000 mortgage has $200,000 in equity; at this calculator's 80% CLTV cap you could borrow up to $100,000, and a $50,000 loan at 8.5% over 10 years would run about $620/month.
What This Calculator Does
The Home Equity Loan Calculator shows how much equity you've built in your home, the maximum amount most lenders would let you borrow against it, and the monthly payment on a fixed-rate home equity loan for the loan amount you choose — your full borrowing picture in one place before you contact a lender.
Home equity is the portion of your home you truly own — its current value minus what you still owe on your mortgage. Lenders typically cap total borrowing, your mortgage plus a new home equity loan, at 80% to 85% of your home's value, known as the combined loan-to-value ratio (CLTV); some lenders extend this to 90% for well-qualified borrowers. This calculator applies an 80% CLTV limit and then runs standard amortization on your chosen loan amount, so a $400,000 home with a $250,000 mortgage balance shows $150,000 in equity, but only about $70,000 of it is actually borrowable under the 80% cap.
Homeowners use this calculator when comparing ways to fund a large expense — a kitchen remodel, tuition, medical bills, or consolidating higher-interest debt — against alternatives like a cash-out refinance or a personal loan. Because a home equity loan is secured by your house, rates are typically lower than unsecured credit cards or personal loans, but missing payments puts your home at risk, so it's worth checking the monthly payment against your budget and comparing it with a HELOC's variable-rate flexibility before committing to a fixed loan. Running a few loan amounts and terms through the calculator before applying also gives you a benchmark for comparing offers, since lenders can quote meaningfully different rates and fees for the same amount of equity.
Formula
Max Loan = (Home Value × 80%) − Mortgage Balance, then M = P × [r(1+r)ⁿ] / [(1+r)ⁿ − 1]First, the calculator finds your borrowing ceiling at 80% combined loan-to-value. Then it applies the standard amortization formula to whatever loan amount you select (capped at that ceiling) to compute your fixed monthly payment.
- PHome equity loan amount (capped at 80% CLTV)
- rMonthly interest rate (annual APR ÷ 12)
- nLoan term in months
- CLTVCombined loan-to-value = (mortgage + new loan) ÷ home value
Examples
Example 1: $400,000 home, $250,000 mortgage, $50,000 equity loan at 8.5% for 10 years
Equity = $400,000 − $250,000 = $150,000. Max loan at 80% CLTV = $320,000 − $250,000 = $70,000, so the requested $50,000 fits within the limit.
Monthly payment ≈ $620.20 — total interest ≈ $24,424, total repaid ≈ $74,424. Resulting CLTV = 75%.
Example 2: Borrowing the maximum available ($70,000) at the same rate and term
Same $400,000 home and $250,000 mortgage, but the homeowner borrows the full $70,000 available at 80% CLTV.
Monthly payment ≈ $868.28 — total interest ≈ $34,193.60, pushing CLTV to exactly 80%.
Example 3: $30,000 HELOC-style loan at 9.0% for 5 years
A smaller, shorter-term loan — common for a kitchen remodel or debt consolidation — at a slightly higher variable-equivalent rate.
Monthly payment ≈ $622.75 — total interest ≈ $7,365, total repaid ≈ $37,365.
Key Terms Explained
- Home Equity
- The share of your home you actually own: its market value minus the balance you still owe on the mortgage.
- HELOC
- A Home Equity Line of Credit — a revolving credit line secured by your home equity that you can draw from as needed.
- Loan-to-Value (LTV)
- The loan amount divided by the property's value, as a percentage. Lenders use LTV to gauge risk; above 80% usually triggers PMI.
- APR (Annual Percentage Rate)
- The yearly cost of borrowing shown as a percentage, including the interest rate plus certain fees. APR lets you compare loans on an equal footing and is usually a bit higher than the plain interest rate.
- Amortization
- Paying off a loan through fixed payments over time. Early payments are mostly interest; later payments are mostly principal as the balance shrinks.
- Closing Costs
- One-time fees to finalize a mortgage (appraisal, title, origination, etc.), typically 2–5% of the loan amount.
- Principal
- The original amount borrowed or invested, before interest. Each loan payment is split between paying down principal and paying interest.
Continue Your Financial Planning
Methodology
Available equity = home value minus mortgage balance. Maximum loan = (home value × 80% CLTV) minus mortgage balance, capping how much you can borrow so your combined debt stays within typical lender limits. The fixed monthly payment is then calculated on your chosen loan amount using the standard installment loan formula, M = P×r(1+r)ⁿ / [(1+r)ⁿ−1].
Frequently Asked Questions
How much home equity can I borrow?+
Most lenders allow you to borrow up to 80–85% of your home's value minus your outstanding mortgage balance. This is called the combined loan-to-value (CLTV) limit. Example: $400K home, $250K mortgage → max equity loan = $320K − $250K = $70K.
What is the difference between a HELOC and a home equity loan?+
A home equity loan gives you a lump sum at a fixed rate — predictable payments, good for large one-time expenses. A HELOC is a revolving line of credit at a variable rate — flexible for ongoing needs. This calculator models a fixed home equity loan.
Is home equity loan interest tax deductible?+
Since the 2017 Tax Cuts and Jobs Act, interest is only deductible if the loan is used to buy, build, or substantially improve the home securing the loan. Using equity for debt consolidation or other purposes is generally not deductible.
How do I calculate how much equity I have in my home?+
Home equity equals your home's current market value minus what you still owe on your mortgage and any other loans secured by the property. For example, a home worth $450,000 with a $280,000 mortgage balance has $170,000 in equity. Your usable equity — what you can actually borrow — is typically lower, since lenders cap combined borrowing at 80-85% of home value.
What is a good loan-to-value ratio for a home equity loan in 2026?+
A lower combined loan-to-value (CLTV) ratio generally gets you a better rate and easier approval. Most lenders prefer a CLTV at or below 80%, meaning your mortgage plus the new loan stay under 80% of your home's value. Borrowers with a CLTV closer to 60-70% typically qualify for the most competitive rates and terms, while a CLTV pushing past 85-90% often means a higher rate, private mortgage insurance, or an outright decline from many lenders.
Can I use a home equity loan or HELOC for anything?+
Yes, funds from a home equity loan or HELOC can generally be used for any purpose — debt consolidation, home improvements, education costs, or major purchases. However, tax deductibility of the interest depends on how the funds are used: only amounts spent to buy, build, or substantially improve the home securing the loan currently qualify for the mortgage interest deduction. Talk with a tax professional before assuming any portion of the interest is deductible for your specific situation.
Can I save my results?+
Yes. Use “Save results” to store a snapshot. Without an account it remains in this browser. If you log in, saved scenarios sync securely to your SmartRates account so they are available on your other devices.
How do I share my calculation?+
Click “Share” in the toolbar to copy a link (or open your device’s share sheet). The link encodes your exact inputs, so whoever opens it sees the calculator pre-filled with the same numbers and the same result.
Can I email my calculator results?+
Yes. Click “Email results” to open your default email application with the current inputs, results, and calculator link already included. Review the message and choose the recipient before sending.
Can I export or print my results as a PDF?+
Yes. Click “Export PDF” to open a clean, printable summary of your inputs and results that you can save as a PDF or print. It includes a timestamp and a link back to the calculator.
How accurate are the calculator results?+
The arithmetic follows the formula and assumptions documented on this page. The result is still an estimate because actual rates, fees, taxes, timing conventions, eligibility rules, and provider calculations can differ. Use figures from your official quote, statement, contract, or tax form before making a financial decision.
Which inputs have the biggest effect on the result?+
Rate, time, starting balance, recurring payments or contributions, and fees usually have the largest effects. Change one input at a time to create a conservative, expected, and optimistic scenario instead of relying on a single forecast.
Are taxes, fees, and inflation included?+
Only when they appear as an input or are explicitly described in the methodology. Do not assume an omitted cost is zero. Review the formula and methodology sections to see exactly what is included before comparing the result with an outside quote.
Can this calculator predict future rates or returns?+
No. A calculator projects the assumptions entered; it cannot predict market returns, inflation, variable interest rates, tax-law changes, or provider decisions. Rerun the calculation with several assumptions to understand the range of possible outcomes.
Why might my lender, bank, broker, or tax software show a different result?+
Professional systems may use daily timing, transaction dates, compounding conventions, rounding rules, account-specific fees, credits, eligibility details, or regulations that a general-purpose calculator cannot know. A small difference can be rounding; a large difference usually means an assumption or included cost is different.
Disclaimer: Calculations are for informational purposes only and do not constitute professional financial advice. Please consult with a certified professional before making financial decisions.