Home Equity Loan Calculator

A home equity loan is a fixed-rate lump-sum second mortgage: you receive the full amount at closing and repay it on a fixed monthly schedule, typically 5–30 years. A HELOC is a revolving line of credit with a variable rate - you draw what you need, when you need it. Home equity loans suit one-time expenses (major renovation, debt consolidation); HELOCs suit ongoing or uncertain costs.

Most lenders cap combined loan-to-value at 80%–85%. On a $500,000 home with a $300,000 primary mortgage, an 85% CLTV cap allows a $125,000 home equity loan. Stronger credit scores (740+) often unlock the highest CLTVs; sub-660 scores may be limited to 70%–75% CLTV.

Home equity loan rates are generally 1%–2% higher than primary mortgage rates because they sit in second-lien position. In 2026, expect roughly 8%–10% APR for borrowers with strong credit. Terms range from 5 to 30 years; shorter terms have higher monthly payments but dramatically lower total interest paid.

Same rule as HELOCs: deductible only if proceeds are used to buy, build, or substantially improve the home securing the loan, and only up to the $750,000 combined mortgage debt cap (post-2017 TCJA). Using the funds for personal expenses, debt consolidation, or investments makes the interest non-deductible.