Home Equity Loan Calculator

How to use this calculator

1. Enter the loan amount you want, the interest rate and the term in years.
2. Press Calculate to see the monthly payment, the total of every payment and the interest inside it.
3. Optionally tick Include closing costs to enter the fees and see what the loan really costs.
4. Read the amortization schedule — annual or monthly — to see how each payment splits between interest and principal.

If you do not yet know how much you can borrow, the second calculator on this page estimates it from your home's value, your mortgage balance and your lender's loan-to-value limit.

Equity versus what you can borrow

Your equity is the home's value minus what you still owe, but lenders rarely let you borrow all of it. They cap your combined loan-to-value (CLTV) — the total of your first mortgage plus the new loan — at a percentage of the home's value. Your borrowing room is that capped total minus the mortgage you already carry, which is usually well below your full equity.

On a $600,000 home with $250,000 still owed, you hold $350,000 of equity. At an 80% cap the lender will allow $480,000 of total debt against the house, so subtracting the existing mortgage leaves $230,000 to borrow — well short of the equity, at a current loan-to-value of 41.7%.

The formulas

The payment is ordinary fixed-rate amortization:

M = L · r · (1 + r)ⁿ / ((1 + r)ⁿ − 1)

• L — the loan amount
• r — the monthly rate (annual rate ÷ 12)
• n — the number of payments (years × 12)

And the borrowing limit is a subtraction:

• Equity = home value − mortgage balance
• Max borrow = home value × max LTV − mortgage balance

A worked example

Borrow $150,000 at 8% over 15 years. The monthly payment is $1,433.48. Across all 180 payments you hand over $258,026.06, of which $108,026.06 is interest — 42% of everything you pay.

The schedule shows why. In year one, $11,804.97 of your payments goes to interest and only $5,396.77 to the balance. By year seven the split has moved to $8,494.04 interest against $8,707.70 principal, and from there the balance falls away quickly. Nothing about the payment changes — only what it is buying.

Closing costs and the real rate

A quoted rate is not what the loan costs you. Home equity closing costs — origination, appraisal, title, recording — typically run 2–5% of the loan, and they buy you nothing. Tick Include closing costs and the calculator shows the real APR: the rate that reflects the cash you actually receive rather than the figure on the paperwork.

On that same $150,000 loan, $7,500 of closing costs means you walk away with $142,500 but repay the full $150,000 on the same schedule. That turns an 8% loan into a real 8.86% one — the fee costs you the better part of a point for fifteen years.

Whether the fee is deducted from the loan or paid upfront makes no difference to that number, and it is worth being clear about why: either way you are down $7,500 against an identical stream of payments. The only thing that changes is whether you need the cash on the day. Shop the fees as hard as you shop the rate.

Home equity loan versus HELOC

Both borrow against equity, but they suit different needs. This tool models the fixed lump-sum loan:

Feature	Home equity loan	HELOC
How you receive it	One lump sum	Revolving line, draw as needed
Interest rate	Fixed	Usually variable
Payment	Fixed principal & interest	Varies with balance and rate
Best for	A known, one-time cost	Staged or uncertain expenses

A home equity loan is ideal when you know the exact cost — a set renovation or a debt consolidation — while a HELOC gives flexibility when the total is uncertain or spread over time.

What lenders check beyond equity

Available equity sets the ceiling, but approval depends on more. Lenders look at your credit score, your income and your debt-to-income ratio — how much of your monthly income already goes to debt. A home equity loan adds a second lien on your property, so they underwrite it much like a mortgage, and your final amount and rate reflect that whole picture.

Borrow carefully

• The loan is secured by your home, so missed payments can put the property at risk — a higher-stakes trade than unsecured borrowing.
• It is best suited to large, one-time costs that add value or replace higher-interest debt, not discretionary spending.
• Closing costs are optional above, and worth entering — the real APR they produce is the number to compare between lenders.
• The estimate uses one fixed rate and does not model taxes, insurance, or a lender's income and credit checks.
• The borrowing limit is an equity calculation only — your approved amount also depends on income, credit score and debt-to-income ratio.

To see the full principal-and-interest breakdown of the loan, use the amortization calculator; to weigh it against your primary home loan, use the mortgage calculator. This is educational information for planning, not a loan offer or financial advice.