Home Equity Loan Calculator
See how much you can borrow against your home equity and what it costs monthly.
About Home Equity Loan Calculator
A home equity loan gives you a lump sum at a fixed rate, secured by your home. Lenders limit borrowing to ensure that your total mortgage debt (first mortgage + equity loan) does not exceed a combined LTV (CLTV) threshold — typically 80–90% of the home's current appraised value. Because the rate is fixed, monthly payments never change, unlike a HELOC. Home equity loans are sometimes called 'second mortgages' and sit junior to the first mortgage in priority.
Formulas
Maximum equity loan
Max Loan = Home Value × CLTV limit − First mortgage balance
- V
- Current home value
- CLTV
- Combined LTV limit (e.g. 85%)
- B₁
- First mortgage balance
Monthly payment
M = L × r(1+r)ⁿ / ((1+r)ⁿ − 1)
- L
- Loan amount
- r
- Monthly interest rate
- n
- Number of monthly payments
Worked example
With the default values below, Home Equity Loan Calculator returns Monthly Payment of $613.26. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Current Home Valueaccepts 10,000–10,000,000 $
- 500,000 $
- Existing Mortgage Balanceaccepts 0–5,000,000 $
- 280,000 $
- Combined LTV Limitaccepts 50–100 %
- 85% (typical)
- Desired Loan Amountaccepts 1,000–2,000,000 $
- 50,000 $
- Annual Interest Rateaccepts 0–25 %
- 8.25 %
- Loan Termaccepts 1–30 years
- 10 years
Results
- Monthly Payment
- $613.26
- Maximum You Can Borrow
- $145,000
- Loan Amount
- $50,000
- Total Interest Paid
- $23,592
- Total Repaid
- $73,592
- Current Home Equity
- $220,000
- Current LTV (First Mortgage)
- 56.00%
- Combined LTV After Loan
- 66.00%
- Remaining Equity After Loan
- $170,000
Step by step
- 1Current home equity= $220,000
- 2Maximum borrowable at 85% CLTV= $145,000
- 3Monthly payment (fixed rate, fully amortizing)= $613.26
- 4Combined LTV after loan= 66.00%
Assumptions and limits
- The result is derived only from the 6 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation, tax or fees or charges into account.
- Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
- Approval and rates depend on credit score, income, LTV and lender guidelines. This calculator is for estimation only.
- This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Approval and rates depend on credit score, income, LTV and lender guidelines. This calculator is for estimation only.
Frequently Asked Questions
How is a home equity loan different from a HELOC?
A home equity loan disbursed as a lump sum with a fixed rate and fixed monthly payments. A HELOC is a revolving credit line with a variable rate and interest-only payments during the draw phase. Use the HELOC Calculator to compare.
What credit score do I need?
Most lenders require at least a 620 credit score, and the best rates typically require 740+. Your CLTV, income and debt-to-income ratio also matter. Shop multiple lenders for the best rate.
Is the interest tax-deductible?
Only if the proceeds are used to buy, build or substantially improve the home securing the loan. Interest on equity loans used for other purposes is no longer deductible under the Tax Cuts and Jobs Act of 2017.
What happens to my equity loan if I sell the home?
Both the first mortgage and the equity loan are paid off from the sale proceeds at closing. The equity loan lender holds a lien on the property and must be satisfied before you receive any net proceeds.