🏠 Finance
Home Equity Loan Calculator
Use this free home equity loan calculator to get fast, accurate results.
📝 Your Assumptions
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A home equity loan lets you borrow against the value you've built in your home, usually at a fixed rate. This calculator shows your exact monthly payment, total interest, and total cost so you can compare offers or plan a renovation, debt consolidation, or major purchase.
How to Use This Calculator
Enter three numbers to see your full repayment picture.
1
Enter your loan amount
Type the amount you plan to borrow, such as $50,000 for a kitchen remodel or $75,000 to consolidate credit cards. Most lenders let you borrow up to 85% of your home's appraised value minus your mortgage balance.
2
Input your interest rate
Enter the fixed annual percentage rate (APR) your lender quoted, for example 7.5%. Even a 0.5% difference matters: on a $50,000 loan over 15 years, 7.5% costs about $2,500 more in total interest than 7.0%.
3
Choose your loan term
Select the repayment period in years, typically 5, 10, 15, or 20. A shorter term like 10 years raises your monthly payment but cuts total interest dramatically compared to a 20-year term.
4
Review your monthly payment
The calculator displays your fixed monthly principal-and-interest payment. For a $60,000 loan at 8% over 15 years, that's $573.44 per month — the same amount every month until the loan is paid off.
5
Compare total interest and total paid
Scroll to see how much interest you'll pay over the life of the loan and the grand total. A $60,000 loan at 8% for 15 years costs $43,219 in interest, bringing the total to $103,219 — useful when weighing a 10-year term instead.
What Your Results Mean
Each number tells you something different about the cost of borrowing.
Monthly Payment
This is your fixed principal-and-interest payment, due every month for the entire term. On a $40,000 loan at 7% for 10 years, it's $464.43. Property taxes and insurance aren't included unless your lender escrows them.
Total Interest
The cumulative cost of borrowing over the full term. A $40,000 loan at 7% for 10 years generates $15,731 in interest — that's the price you pay for access to the money.
Total Paid
Principal plus interest — the full amount that leaves your pocket. For the same $40,000 loan at 7% over 10 years, total paid is $55,731. Compare this against a 15-year term to see the trade-off.
Loan Term Impact
Stretching from 10 to 20 years lowers the monthly payment but can nearly double total interest. A $50,000 loan at 7.5% costs $21,155 in interest over 10 years but $46,891 over 20 years — a $25,736 difference.
Interest Rate Sensitivity
Rates drive your cost more than almost anything else. On a $75,000 15-year loan, 7% interest totals $46,397, while 9% totals $61,836 — a $15,439 swing for the same money.
Home Equity Limit
Lenders typically cap your combined loan-to-value (CLTV) at 80–85%. If your home is worth $400,000 and you owe $250,000, at 85% CLTV you could borrow up to $90,000 ($340,000 minus $250,000).
Key Terms
Home Equity
The difference between your home's market value and what you still owe on your mortgage. If your home is worth $350,000 and you owe $200,000, you have $150,000 in equity.
Amortization
The process of paying off a loan through scheduled payments that cover both interest and principal. Early payments are mostly interest; later payments are mostly principal.
Loan-to-Value (LTV)
Your mortgage balance divided by your home's appraised value, expressed as a percentage. A $200,000 balance on a $350,000 home is 57% LTV.
Combined Loan-to-Value (CLTV)
The total of all loans secured by your home divided by its value. If you add a $50,000 home equity loan to a $200,000 mortgage on a $350,000 home, your CLTV is 71%.
Fixed Interest Rate
An interest rate that stays the same for the entire loan term, so your monthly payment never changes. This differs from a home equity line of credit (HELOC), which usually has a variable rate.
❓ Frequently Asked Questions
Your payment is calculated using the standard amortization formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of monthly payments. For a $50,000 loan at 8% over 15 years, r = 0.006667 and n = 180, giving a monthly payment of $477.83. Over the full term you'd pay $36,009 in interest, for a total of $86,009. The calculator handles this math instantly, so you can test different amounts, rates, and terms side by side. If you're also weighing a cash-out refinance, compare results with our mortgage calculator to see which structure costs less overall.
A home equity loan gives you a lump sum with a fixed interest rate and a fixed monthly payment, much like a second mortgage. A HELOC (home equity line of credit) works more like a credit card: you draw money as needed, the rate is usually variable, and payments can change month to month. Say you need $60,000 for a renovation. A fixed home equity loan at 8% for 15 years costs $573.44 per month and $43,219 in total interest. A HELOC starting at 8% could drop to 6% or jump to 11% depending on the prime rate, making your payment unpredictable. If you want certainty and you know the full amount you need, the fixed loan is easier to budget. If you need flexibility or plan to repay quickly, a HELOC may cost less in interest. Run both scenarios through this calculator and our loan calculator to compare.
Most lenders allow a combined loan-to-value (CLTV) ratio of 80% to 85%. Suppose your home appraises for $400,000 and you still owe $240,000 on your first mortgage. At 85% CLTV, your maximum total debt is $340,000, so you could borrow up to $100,000 in home equity. At 80% CLTV, the cap is $320,000, meaning $80,000 available. Your credit score, income, and debt-to-income ratio also affect approval and the rate you're offered. A 760 credit score might get 7.25%, while a 660 score might see 9.5% — on a $100,000 15-year loan, that difference costs about $23,000 in extra interest. Once you know your limit, plug the number into the calculator to see the monthly payment before you apply.
Interest is deductible only if you itemize and use the loan proceeds to buy, build, or substantially improve the home that secures the loan. The Tax Cuts and Jobs Act capped deductible home loan debt at $750,000 for married couples filing jointly ($375,000 for separate filers). If you borrow $80,000 to add a bedroom, the interest may qualify. If you use that same $80,000 to pay off credit cards or buy a car, the interest is not deductible. On an $80,000 loan at 8% in year one, you'd pay roughly $6,300 in interest — potentially saving $1,400 to $2,200 in taxes if you're in the 22% to 35% bracket and qualify. Consult a tax professional about your specific situation, and use our mortgage calculator to model how the added debt affects your overall housing costs.
A shorter term means a higher monthly payment but far less interest. On a $60,000 loan at 8%, a 10-year term costs $727.94 per month and $27,353 in total interest. A 15-year term drops the payment to $573.44 but raises total interest to $43,219. That's $15,866 more in interest for a payment that's $154.50 lower each month. Choose 10 years if the payment fits your budget comfortably and you want to minimize cost. Choose 15 years if the lower payment gives you breathing room for emergencies or other goals. A middle option: take the 15-year loan but pay an extra $150 per month — you'll finish in about 11 years and save thousands. Test any extra-payment strategy against our loan calculator to see the payoff date.
Most lenders want a credit score of at least 620, but the best rates go to borrowers at 740 or higher. The rate gap is real: on a $75,000 15-year loan, 7.0% costs $46,397 in interest, while 10.0% costs $70,070 — a difference of $23,673. If your score is below 680, expect rates 1.5 to 3 percentage points higher, and some lenders may cap your CLTV at 75% or 80% instead of 85%. Improving your score by 40 to 60 points before applying can save you thousands. Pay down revolving balances below 30% utilization, dispute errors on your credit report, and avoid opening new accounts for six months. Once you have a rate quote, enter it here alongside our auto loan calculator and loan calculator to see how the payment fits your full debt picture.
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