Home Equity Loan Calculator
Calculate monthly payments for a home equity loan based on your available equity and loan terms.
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Home Equity Loan
A home equity loan lets you borrow against your home's equity at a fixed rate. Most lenders allow up to 80% of your home's value minus your outstanding mortgage balance. The loan is typically paid back in fixed monthly installments.
What is the Home Equity Loan Calculator?
The Home Equity Loan Calculator determines exactly how much cash a homeowner can borrow against the value of their property. It evaluates the current market value of the house against the remaining mortgage balance.
How It Works (Formula)
Banks rarely let you borrow 100% of your home's value. They usually cap the Loan-to-Value (LTV) ratio at 80% or 85%. The calculator multiplies your home's current value by this LTV limit, and then subtracts the amount you still owe to your first mortgage lender.
$$ \text{Max Loan} = (\text{Home Value} \times \text{Max LTV \%}) - \text{Current Mortgage Balance} $$
The banking formula for extracting equity without excessive risk.
How to Use It
Enter the estimated current market value of your home. Enter the exact balance remaining on your primary mortgage. The calculator will output the maximum lump sum of cash the bank is likely to approve for your Home Equity Loan.