To use this HELOC calculator, enter the loan amount, interest rate, draw period, and repayment period. Optionally, include property value, current mortgage balance, and whether to include closing costs. The calculator will provide monthly payments and total interest paid.
The monthly payment during the draw period is calculated as an interest-only payment: Monthly Payment = Loan Amount × (Interest Rate / 12). During the repayment period, the payment is calculated using the formula for an amortizing loan: Monthly Payment = (Loan Amount × (Interest Rate / 12)) / (1 - (1 + (Interest Rate / 12))^(-Repayment Period in Months)).
Consider a $50,000 HELOC with an 8% interest rate, a 5-year draw period, and a 15-year repayment period. The monthly payment during the draw period would be $333.33, and during the repayment period, it would be approximately $477.83.
When considering a HELOC, evaluate your ability to handle increased payments after the draw period. Also, consider the total cost of the loan, including interest and fees. Use the Refinance Calculator to explore other options.