A HELOC usually has two phases. During the draw period, which can last 10 years, many lines need only interest: $283.33 a month on $40,000 at 8.5%. In the repayment period, principal is added, so the same $40,000 costs $495.94 over 10 years or $347.13 over 20 years. HELOC rates are usually variable and often track the prime rate, which was 7.00% in October 2026.
This HELOC calculator estimates the monthly payment to amortize a drawn home equity line balance. Enter the drawn principal, annual rate, and repayment months. Results include payment, total paid, and total interest.
Homeowners use it when a draw period ends, when they want to pretend a revolving balance is on a fixed payoff plan, or when comparing a HELOC draw to a closed end loan. Confirm live HELOC terms with your lender.
How the payment is calculated
The tool uses a standard amortizing PMT on the drawn amount, annual rate, and month count. It does not track unused credit, interest only minimums, or future draws.
Worked example
Drawn amount $40,000, rate 8.5 percent, 120 months. Monthly payment is about $495.94.
| Input | Value |
|---|---|
| Drawn principal | $40,000 |
| Rate | 8.5% |
| Months | 120 |
| Monthly payment | ~$495.94 |
HELOC payment on $40,000 drawn
| Rate | Interest-only | 10-yr repayment | 15-yr | 20-yr |
|---|---|---|---|---|
| 7.0% | $233.33 | $464.43 | $359.53 | $310.12 |
| 8.5% | $283.33 | $495.94 | $393.90 | $347.13 |
| 10.5% | $350.00 | $539.74 | $442.16 | $399.35 |
Sources: CFPB, “What is a HELOC?” (draw periods can last 10 years, repayment often runs 10 or 20 years, and the rate is usually variable) and the Federal Reserve H.15 bank prime loan rate of 7.00% (week of Oct 19–23, 2026).
How to use the calculator
- Enter the balance you intend to repay, not the full line if you have not drawn it.
- Enter a current or stress test annual rate.
- Enter repayment months that match your plan or lender schedule.
- Compare payment against budget and the debt to income calculator.
Draw period versus repayment
Many HELOCs allow interest focused payments while the line is open, then require amortization later. This page focuses on amortizing the drawn amount. If you are still in a draw period, the live minimum due may be lower than this fully amortizing estimate.
Variable rate risk
If the index rises, payment capacity shrinks. Stress the rate upward before relying on a HELOC for long projects. For first mortgage payoff experiments, see the mortgage payoff calculator on this site.
Common mistakes
- Entering the full credit limit when only part is drawn
- Ignoring that variable rates can move after you calculate
- Treating interest only quotes as equal to amortizing payments
- Forgetting closing or annual fees outside the PMT
Planning draws without overborrowing
Because a HELOC can be drawn in pieces, people sometimes treat the line like free cash. Amortizing the drawn amount with this calculator restores discipline. Before each draw, enter the new projected balance and see the payment that would clear it on your chosen schedule.
If you only pay interest during a draw period, principal stays flat and later amortizing payments can jump. Running the amortizing view early shows that future payment before you spend.
Rate resets and budget stress
Variable HELOC rates move with indexes and lender margins. Add one to three percentage points in a stress run. If the stressed payment breaks the budget, reduce the planned draw or shorten other debts first.
Some HELOCs have floors or introductory rates. Enter the rate that will apply for most of the repayment life, not only a teaser.
HELOC funds can be useful for renovations that raise home function, but payment math should stay honest. Use the HELOC calculator to translate a draw into a concrete monthly obligation, then decide whether the project still makes sense beside your first mortgage.
HELOC versus cash out refinance
A cash out refinance replaces the first mortgage and may close the HELOC opportunity into a single payment. A HELOC keeps the first mortgage and adds a second lien payment on draws. Use this calculator for the second lien amortizing view, and use a mortgage payment tool for the first lien. Add both when you judge affordability.
Closing costs differ a lot between a line of credit setup and a full refinance. Fee drag can erase a small rate win.
Is HELOC interest tax-deductible?
Only if you use the money to buy, build or substantially improve the home that secures the line, and only within the $750,000 ($375,000 MFS) mortgage debt limit. See IRS Publication 936 (2025).
Limitations
Tax deductibility, lien position, and lender floors are not modeled. Use the estimate for cash planning, then read the HELOC agreement.