HELOC Calculator
How HELOC payments actually work.
Calculate HELOC monthly payments across draw and repayment periods — see the total interest paid over the loan's full life.
What this tool does
A HELOC splits into two payment phases: the draw period and the repayment period. During the draw period, monthly payments cover interest only on the amount you've borrowed. Once the draw period ends, the repayment period begins and payments switch to a full amortisation schedule, covering both principal and interest over the remaining years. This calculator models both phases, showing your monthly payment amount for each and the total interest cost across the entire loan term. The interest rate and the size of your drawn balance are the primary drivers of your payment amounts. The calculator assumes a fixed interest rate throughout both periods and does not account for additional borrowing during the draw period or penalty fees. Results are for illustration only and reflect the mechanics of how these two-phase loans typically function.
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Formula Used
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Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
HELOC (Home Equity Line of Credit) lets homeowners borrow against home equity as needed. Typical structure: 10-year draw period (interest-only payments) followed by 10-20 year repayment period (principal + interest). This calculator shows both phases.
100,000 credit line with 60,000 drawn at an 8% nominal annual rate, 10-year draw, 15-year repayment: Draw period monthly is 400 interest-only. Repayment period monthly is 573 (P&I). Total interest over both phases ~91,000. HELOC flexibility comes at a cost over time.
HELOC rates are typically variable, tied to a base rate plus margin, so rising-rate environments increase borrower payments. HELOCs are commonly drawn for purposes like home improvement, education, or emergencies rather than discretionary spending. Carrying long-term HELOC balances typically costs more than traditional mortgage refinancing.
Run it with sensible defaults
Using heloc credit line of 100,000, current balance drawn of 60,000, interest rate of 8%, draw period of 10, the calculation works out to 400.00. The defaults are meant as a starting point, not a recommendation.
The levers in this calculation
The inputs — HELOC Credit Line, Current Balance Drawn, Interest Rate, Draw Period, and Repayment Period — do not pull with equal force. Not every input has equal weight. Adjusting one input at a time toward extreme values shows which ones move the result most.
How the math works
Draw period: interest-only = balance × monthly rate. Repayment period: standard amortisation over repayment years.
What the headline rate hides
Lenders quote a rate; what you pay is a blend of that rate, fees, insurance, and any early-repayment penalty built into the product. The figure here isolates the core interest cost so you can compare like-for-like across deals; fees, insurance, and other costs sit on top of that base.
What this doesn't capture
The figure shown reflects the core calculation; additional costs such as arrangement fees, valuation, legal fees, insurance, and any early-repayment charges (where applicable) sit on top and can add materially to the total cost of borrowing. Rates and product terms can also change over the life of the loan, which can shift the picture relative to this fixed-snapshot estimate.
£100,000 credit line, £60,000 drawn at 8% over 10 years draw + 15 years repayment = $400.00 draw monthly.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
The calculator computes monthly payments in two phases. During the draw period, the monthly interest payment equals the current balance drawn multiplied by the monthly interest rate, with no principal repayment. During the repayment period, the calculator applies standard amortisation, determining a fixed monthly payment that repays the outstanding balance in full over the specified repayment years. The model assumes a constant interest rate throughout both phases and treats the interest rate as nominal, converting it to a monthly figure. It does not account for variable rate changes, additional draws or repayments beyond the initial balance, early repayment penalties, account fees, or changes in the available credit line. Results show the payment structure under these assumptions but do not predict actual account behaviour.
Frequently Asked Questions
How is HELOC different from a home equity loan?
What are HELOC risks?
Are HELOCs available everywhere?
What's tax treatment?
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