A HELOC vs home equity loan calculator helps you compare two popular ways to tap your home equity side by side. Enter your home value, mortgage balance, and desired borrowing amount to instantly see monthly payments, total interest, and total cost for both options — so you can choose the one that fits your budget and goals.
Home & Loan Details
HELOC (Variable Rate)
Variable rate — may change over time
Interest-only payments during this period
Home Equity Loan (Fixed Rate)
Fixed rate — stays the same for the life of the loan
Enter your home details and click
Compare HELOC vs Home Equity Loan
How to Use the HELOC vs Home Equity Loan Calculator
Choosing between a HELOC and a home equity loan is one of the most important financial decisions homeowners face when tapping their equity. This calculator removes the guesswork by showing you exactly how monthly payments, total interest, and total cost compare — so you can pick the option that best fits your budget and timeline.
Step 1: Enter Your Home Details
Start by entering your home's current market value and your remaining mortgage balance. The calculator uses these figures to determine your available equity — most lenders allow borrowing up to 85% of your home's value minus your existing mortgage. If the amount you need exceeds your available equity, the calculator will alert you before running the comparison.
Step 2: Set Your Borrowing Amount and Term
Enter the amount you need to borrow and select the total repayment term. The repayment term applies to the home equity loan directly, and is also used to calculate the HELOC repayment phase (total term minus the draw period). Shorter terms mean higher monthly payments but less total interest paid over the life of the loan.
Step 3: Adjust Rates and HELOC Draw Period
Enter the interest rate for each option. HELOCs typically carry variable rates that may change with the prime rate, while home equity loans offer fixed rates for predictable payments. Set the HELOC draw period — the initial phase (usually 5-10 years) where you make interest-only payments before switching to full principal-and-interest payments.
Step 4: Compare the Results
The calculator shows side-by-side comparison cards with monthly payments for each phase, total interest paid, and total cost. Pay special attention to the HELOC's two-phase structure: the low interest-only draw period payment looks attractive, but the repayment phase payment can be significantly higher. The recommendation banner tells you which option saves more overall and by how much.
When to Choose Each Option
A home equity loan is typically better when you need a fixed amount upfront (like a major renovation or debt consolidation) and want the security of predictable payments. A HELOC is often better when you need flexible access to funds over time, want lower initial payments, or plan to pay off the balance quickly during the draw period. Keep in mind that HELOC rates are variable — if rates rise, your total cost could exceed the home equity loan. This HELOC vs home equity loan calculator helps you model both scenarios so you can make a confident decision.
FAQ
What is the difference between a HELOC and a home equity loan?
A home equity loan (HEL) gives you a lump sum with a fixed interest rate and fixed monthly payments over a set term. A HELOC (home equity line of credit) works like a credit card with a variable rate — you have a draw period where you pay interest only, followed by a repayment period where you pay principal and interest. HELOCs offer more flexibility but less predictability.
Is this HELOC vs home equity loan calculator free?
Yes, this calculator is completely free with no signup, no account, and no hidden fees. All calculations run locally in your browser — your financial details are never sent to any server or stored anywhere.
Is my financial data private when using this tool?
Absolutely. All calculations happen entirely in your browser using JavaScript. No data is ever transmitted to a server, stored in a database, or shared with third parties. You can even use the tool offline. Your home equity details remain fully private.
How much home equity can I borrow against?
Most lenders allow you to borrow up to 85% of your home's appraised value minus your remaining mortgage balance. For example, if your home is worth $400,000 and you owe $250,000, your available equity is $400,000 x 0.85 - $250,000 = $90,000. Some lenders may allow up to 90%, but 85% is the standard maximum.
What is a HELOC draw period?
The draw period is the initial phase of a HELOC (typically 5-10 years) during which you can withdraw funds and usually make interest-only payments. After the draw period ends, you enter the repayment period where you must pay back both principal and interest, causing your monthly payment to increase significantly.
Which is better — HELOC or home equity loan?
It depends on your situation. A home equity loan is better if you need a fixed amount and want predictable payments. A HELOC is better if you need flexibility to draw funds over time (like for ongoing renovations). HELOCs often have lower initial payments during the draw period, but the variable rate means payments can increase later.
Are home equity loan and HELOC interest rates tax deductible?
Interest on both HELOCs and home equity loans may be tax deductible if the funds are used to buy, build, or substantially improve the home securing the loan. The deduction applies to combined mortgage debt up to $750,000 (or $375,000 if married filing separately). Consult a tax professional for your specific situation.