How our HELOC calculator works
The NerdWallet HELOC calculator lets you see if you could qualify for a HELOC and how much you might be able to borrow in sum. hack in these numbers :
- Your home ’ mho stream market value. Use our Home Value Estimator to get an theme of what it ‘s worth .
- The outstanding balance on your mortgage. This is how much you ’ five hundred owe if you paid off the mortgage today. You can check your latest mortgage instruction for an estimate .
- Your accredit sexual conquest. diffident where you stand ? You can sign up with NerdWallet for your unblock credit score .
The calculator will give your current loan-to-value ratio — the share of your home ’ s value that you owe to your mortgage lender — and whether you might qualify for a HELOC or need to wait. If it looks like you qualify, the HELOC calculator estimates how much you might be able to borrow. The amount you can borrow with a HELOC normally depends on how much home equity you have and your credit score. Typically lenders won ’ metric ton permit you tap into your home equity if you still owe more than 85 % of your home ’ second value. however, there are exceptions ; some lenders will let you borrow against your home equity at higher loan-to-value ratios.
More ways to use the home equity line of credit calculator
Our HELOC calculator gives you answers based on a current appraisal of your home ’ second respect, the outstanding mortgage balance and your credit mark. But you can besides run what-if scenarios, such as :
- What if you improve your credit score ? Generally lenders require a credit score of at least 620 for a HELOC. Select a higher score to see how improving your accredit affects your ability to qualify .
- What if the house commercialize slumps ? Over the long draw, home prices generally rise, but they can take big dips, besides. Plug in a lower home value to see its consequence on your borrowing capability.
- What if you pay down your mortgage balance ? You credibly won ’ triiodothyronine qualify for a HELOC if you owe more than 85 % of your base ’ sulfur rate. See how that might change as you pay down your mortgage .
Is a HELOC a good idea?
Our HELOC calculator will tell you whether you might qualify and how much you could be able to borrow through a family equity line of credit. But no calculator can tell you whether tapping into that money is a beneficial mind. Getting a HELOC can make smell for projects that may increase your home plate ’ south measure, such as major repairs or remodeling. But drawing from home equity is bad for early uses, such as covering vacation expenses, paying off recognition calling card debt or buying a car. No matter the reason, your home is the collateral for the HELOC, so bankruptcy to make payments could lead to foreclosure.
How are HELOC payments calculated?
Calculating the monthly payment on a HELOC is crafty, because the sum you owe each month will vary depending on respective factors. current interest rates : Home equity lines of recognition have adjustable rates, so the sum of interest you ‘re paying will vary. See today ‘s HELOC rates. Age of the loan : HELOCs have two parts. First is the draw period, during which you borrow money and make payments against the sake. then comes the refund time period, when — as the name implies — you repay the chief and concern. Unless you make payments toward your star during the pull period, your monthly payment will likely be well higher during the repayment menstruation. Rate caps : The adjustable rates on a home equity line of credit come with two key parameters. One is the life cap, which is the highest matter to pace you could possibly pay. The other is the periodic crown, which is how frequently the interest rate can change.
Find the best HELOC lender for you
It pays to shop around when searching for the best deal on a HELOC. Check with your primary coil trust or current mortgage lender, which might offer a deduction. Take that quote and compare it with quotes from at least two other lenders.
Pay attention to all the terms being offered by the lender. You may have a low-interest basic menstruation ( sometimes referred to as a “ tease rate ” ), but you ‘ll want to look at the life cap to estimate how high your monthly payment could get. You may be able to negotiate with the lender so character of the HELOC has a fixed rate or for the ability to partially pay down the principal during the draw period.