HELOC Payment Calculator

This is the draw-period payment only, and it is interest with no principal — the balance at the end is exactly what it was at the start. When repayment begins the payment typically doubles or worse, because the whole balance then has to be paid off.

This calculator gives the monthly payment on a home equity line of credit during the draw period — and only during it. That is the interesting number because it is the one that looks affordable: it is interest with no principal in it at all. The arithmetic is correspondingly short, the amount drawn times the annual rate, divided by twelve. On the defaults, 50,000 at 8.5 % is 354.17 a month. None of that repays anything, so after twelve payments you have handed over 4,250 and still owe the same 50,000. Double the balance and the payment doubles exactly — 100,000 at the same rate is 708.33 — because there is no amortisation in the way. What the figure does not contain is everything that comes afterwards. When the draw period ends, repayment begins, the whole balance has to be paid off over the remaining years, and the payment typically doubles or worse. Annual fees, draw fees, closing costs and any minimum-payment rule your lender applies sit outside this arithmetic too. The limitation that matters most is that the rate is not fixed: a line of credit is normally variable, so this payment moves with it. At 50,000, each extra percentage point is another 41.67 a month — enter a higher rate and the calculator shows it at once.