Home Equity Loan Calculator
$
$
$
7.00%
15 yrs
Monthly Payment$449.41
Available Equity$182,500.00
Total Interest$30,894.54
Combined LTV Ratio55.56%
A home equity loan lets you borrow a lump sum against the equity in your home and repay it in fixed installments. This calculator first works out how much equity is actually available under a typical 85 percent combined loan-to-value cap, then computes the fixed monthly payment and total interest on the amount you request. It also flags when your requested loan would push you past the lender limit.
Formula
Available equity = value × 0.85 − mortgage; CLTV = (mortgage + loan) ÷ value × 100
- value
- Current market value of the home
- mortgage
- Outstanding balance on the first mortgage
- 0.85
- Maximum combined loan-to-value ratio allowed
- loan
- Requested home equity loan amount
How it works
- Enter your home value, the balance remaining on your primary mortgage, the loan amount you want, the interest rate, and the term in years.
- Available equity is computed as 85 percent of the home value minus the existing mortgage balance, the standard ceiling lenders allow for a second-lien equity loan.
- The calculator amortizes the requested loan into a fixed monthly payment, totals the interest over the term, reports the combined loan-to-value ratio, and warns if the request exceeds the available equity.
Worked example
A $500,000 home with a $200,000 first mortgage, borrowing $100,000 at 7.5% over 15 years.
- Available equity: 500,000 × 0.85 − 200,000 = 425,000 − 200,000 = $225,000 (request fits).
- Amortize $100,000 at 7.5% over 15 years: monthly payment ≈ $927.01.
- Total interest: 927.01 × 180 − 100,000 ≈ $66,862.22.
- Combined LTV: (200,000 + 100,000) ÷ 500,000 × 100 = 60%.
Monthly payment about $927.01, total interest about $66,862.22, available equity $225,000, and a combined LTV of 60%.
Frequently asked questions
- How much equity can I borrow?
- Lenders typically cap your combined first mortgage plus equity loan at about 85 percent of the home value. This calculator computes available equity as 85 percent of value minus your current mortgage balance.
- How is a home equity loan different from a HELOC?
- A home equity loan gives you a single lump sum with a fixed rate and fixed payments for the full term. A HELOC is a revolving line you draw from over time, usually with a variable rate and an interest-only draw period.
- What does the combined loan-to-value ratio tell me?
- Combined LTV is the total of your first mortgage and the new equity loan divided by the home value. Lenders use it to gauge risk; a CLTV at or below 85 percent is generally acceptable for an equity loan.
- What happens if I request more than my available equity?
- The calculator flags the request as over the limit and still shows the payment for what you entered, but a lender would likely decline or reduce the amount. Lower your requested loan to bring the combined LTV under 85 percent.