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Available Credit Line
$0
Draw-Period Payment
$0
interest-only
Home Equity
$0
Estimate your available home equity line of credit and monthly payment during the draw or repayment period.
$0
Draw-Period Payment
$0
interest-only
Home Equity
$0
Multiply your home's value by the lender's maximum combined loan-to-value ratio (often 80-85%), then subtract your existing mortgage balance. A $400,000 home with an 80% CLTV and a $220,000 mortgage balance gives $400,000 × 0.80 − $220,000 = $100,000 available credit line.
Available Credit = (Home Value × Max CLTV%) − Mortgage Balance
A Home Equity Line of Credit (HELOC) is a revolving credit line secured by your home's equity, working more like a credit card than a traditional loan: you're approved for a maximum credit line and can draw against it as needed, rather than receiving a single lump sum upfront. Interest is charged only on the amount actually drawn, not the full approved line.
A HELOC has two distinct phases. During the draw period (commonly 10 years), you can borrow against the line as needed, and many lenders only require interest-only payments on the drawn balance during this phase, which keeps payments low but means the principal doesn't shrink unless you pay more than the minimum. Once the draw period ends, the HELOC enters the repayment period (commonly 10-20 years), where you can no longer draw new funds and must pay down both principal and interest, which typically causes a significant payment increase compared to the interest-only draw period.
Lenders cap total borrowing against a home using combined loan-to-value: your existing mortgage balance plus the new HELOC line, divided by the home's value. Most lenders cap CLTV around 80-85%, which is why a home with a large existing mortgage balance has less available HELOC credit than the same-value home with a smaller mortgage, even though both may have identical market value.
Most HELOCs carry a variable interest rate tied to a benchmark index, meaning your interest-only draw-period payment can rise or fall as rates move, which is a meaningfully different risk profile than a fixed-rate home equity loan or a fixed-rate mortgage. Some lenders offer the option to convert a portion of a drawn HELOC balance to a fixed rate, which can be worth considering for a large, planned expense you don't want exposed to rate movement.
Multiply your home's value by the lender's maximum combined loan-to-value ratio (often 80-85%), then subtract your existing mortgage balance. The result is your approximate available HELOC credit line.
During the draw period (often 10 years), you can borrow against the line and typically make interest-only payments on what you've drawn. During the repayment period (often 10-20 years), you can no longer draw and must repay principal and interest.
Most HELOCs carry a variable interest rate tied to a benchmark index, meaning your payment can change over time as rates move, unlike a fixed-rate home equity loan or mortgage.
For official guidance, see the CFPB's home equity resources. Compare against a fixed-payment option with the Home Loan Calculator or check your overall affordability with the Loan Affordability Calculator.
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