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Home Equity Loan Calculator

Updated · By the CalculatorDash editorial team · How we check our maths

Quick answer

Lenders typically let you borrow up to 80–85% of your home's value across all loans. With a $450,000 home, a $250,000 mortgage and an 85% limit, you could borrow up to about $132,500. Borrowing $50,000 at 8.5% over 10 years costs about $620 a month.

Home equity

$
$
%
$
%

Maximum you could borrow

$132,500

Current equity
$200,000
Monthly payment on your amount
$620

Capped at the maximum available.

Combined LTV after borrowing
66.7%

How this calculator works

Home equity is the part of your home's value you own outright: its market value minus your mortgage balance. Lenders let you borrow against some of it, keeping the combined loan-to-value (all loans ÷ home value) below a limit, commonly 80–85%.

A home equity loan gives you a lump sum at a fixed rate; a HELOC works like a credit line with a variable rate. Both are secured by your home, so missing payments puts the house at risk. They're usually cheaper than personal loans because of that security.

The formula

Available
home value × maximum LTV − mortgage balance
Payment
standard amortisation on the amount borrowed
Combined LTV
(mortgage + new loan) ÷ home value

Worked example

A $450,000 home at an 85% limit supports $382,500 of total borrowing. With $250,000 owed, up to $132,500 is available. Borrowing $50,000 at 8.5% over 10 years costs about $620 a month, and your combined LTV becomes 66.7%.

Tips

  1. 01Get a realistic home value; the lender's appraisal decides the limit.
  2. 02Use equity for things that add value or replace higher-rate debt, not everyday spending.
  3. 03Compare a cash-out refinance if your first mortgage rate is higher than current rates.

Frequently asked questions

How much equity can I borrow?

Usually up to 80–85% of the home's value minus what you owe, subject to credit and income checks.

What is the difference between a home equity loan and a HELOC?

A home equity loan is a fixed lump sum with fixed payments. A HELOC is a revolving line you draw from as needed, usually at a variable rate.

Is home equity loan interest tax deductible?

In the US it can be when the money is used to buy, build or substantially improve the home securing the loan. Ask a tax professional.

What is LTV?

Loan-to-value: the loan balance divided by the property's value. Combined LTV includes every loan secured by the home.