A HELOC usually has two phases: an interest-only draw period and a repayment period where principal is paid off. Enter your balance and rate to see the payment in each phase, the jump between them and what a rate rise would do.
| Rate | Draw period payment | Repayment payment | Total interest |
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See the jump when interest-only ends.
Know what a draw will cost each month.
Check affordability if rates rise.
A HELOC is a revolving credit line secured by your home. During the draw period you can borrow, repay and borrow again, and the minimum payment is usually interest only.
Because the line is secured by your home, falling behind can put the property at risk. Treat the repayment-period payment, not the low interest-only payment, as the number to budget for.
Often 10 years, interest-only payments.
Often 10-20 years, principal and interest.
All home loans / home value.
Usually interest only: balance x annual rate / 12. A $50,000 balance at 8.5% costs about $354 a month.
You can no longer borrow and the balance is repaid with principal and interest over the repayment period, often 10 to 20 years. Payments can rise sharply; this is called payment shock.
Lenders typically allow a combined loan-to-value (CLTV) of 80-90%: home value x CLTV limit - mortgage balance.
Most are, tied to the prime rate. The rate-rise table shows how payments would change if rates go up.
Yes. Every extra payment reduces the balance, which lowers the interest and the repayment-period payment.
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