Home Equity Loan Calculator

Home Equity Loan Calculator

Wondering how much equity you can tap into your home? Our Home Equity Loan Calculator makes it easy to estimate how much you may qualify to borrow, based on your home's market value, your remaining mortgage balance, and the loan-to-value (LTV) ratio lenders allow.

This tool helps you plan smarter when considering a second mortgage, home improvement loan, or debt consolidation strategy using your home's equity.

What Is a Home Equity Loan?

A home equity loan allows you to borrow money using the value you've built in your home (your "equity") as collateral. Equity is the difference between your home's current market value and what you still owe on your mortgage.

Home equity loans typically come with fixed interest rates, fixed monthly payments, and a set repayment term. They’re commonly used for major expenses like:

• Home renovations
• Medical bills
• College tuition
• Debt consolidation

How the Calculator Works

Our calculator uses the following inputs to estimate how much you can borrow:

• Estimated market value of your home
• Current mortgage balance
• Maximum loan-to-value (LTV) ratio, usually 80–90% depending on the lender

The calculator then estimates your available equity and potential loan amount based on lender guidelines.

Example Calculation

If your home is worth $400,000 and your current mortgage balance is $250,000:

• Maximum LTV allowed by lender: 85%
• 85% of $400,000 = $340,000
• $340,000 − $250,000 = $90,000 available equity

That means you may be able to borrow up to $90,000 using a home equity loan.

Why Use a Home Equity Loan?

Home equity loans are attractive because:

• Lower interest rates than credit cards or personal loans
• Fixed repayment schedule with predictable payments
• Potential tax benefits (check with your tax advisor)
• Can fund large expenses or consolidate high-interest debt

They’re a reliable way to unlock your home’s value without selling or refinancing.

What Is Loan-to-Value (LTV) Ratio?

The Loan-to-Value (LTV) ratio is the percentage of your home’s value that you're borrowing. Most lenders allow up to 80% or 85% total LTV, including your existing mortgage and the home equity loan.

For example:

• Home Value: $300,000
• Current Mortgage: $180,000
• Max LTV: 85% → $255,000 max total borrowing
• $255,000 − $180,000 = $75,000 available loan amount

Keeping your LTV lower can improve your chances of approval and better interest rates.

When to Consider a Home Equity Loan

You might consider a home equity loan if you:

• Have significant home equity built up
• Need a large lump sum for a specific purpose
• Want fixed monthly payments
• Prefer predictable terms over a flexible line of credit (HELOC)

Who Should Use This Calculator?

This calculator is ideal for:

• Homeowners exploring equity-based financing
• Renovators planning a remodeling project
• Debt managers consolidating high-interest loans
• Borrowers comparing refinancing vs. home equity options

It’s a smart first step before talking to banks or lenders.

Get Started Today

Use our free Home Equity Loan Calculator to see how much you could borrow and make better financial decisions with confidence. Whether you're planning a home upgrade or consolidating debt, understanding your home equity is key.