cost-calculation
HELOC Payment Calculator (2026) — Draw vs Repayment Estimator
A home equity line of credit works differently from a standard loan — you have two distinct phases. During the draw period (typically 10 years), you pay interest only on the balance you've used. When the draw period ends, the line converts to a fully amortizing repayment period and your payment often jumps significantly. This calculator shows both numbers and the payment shock in between, so you can plan before that transition hits.
Educational estimate based on the inputs you entered — not financial, legal, or tax advice. Verify against your specific situation before acting on this output.
How it works
Methodology
Inputs
- Outstanding HELOC balance
- The amount you have drawn from the line — the balance on which interest accrues. If you haven't drawn yet, use your anticipated draw amount.
- Current APR
- Your current annual percentage rate. HELOCs are typically variable, so this will change as the prime rate moves. Use the rate on your current statement.
- Draw period (years)
- The length of the interest-only draw period per your HELOC agreement. Most HELOCs have a 10-year draw period; some are 5 or 15 years.
- Repayment period (years)
- The amortization length after the draw period ends. Common values are 10, 15, or 20 years. Check your agreement — some lenders require full repayment in 10 years, which significantly increases the payment shock.
Formula
Draw period (interest-only): r = APR / 100 / 12 interestOnlyMonthly = balance × r (if r = 0 → 0) totalDrawInterest = interestOnlyMonthly × drawMonths Repayment period (fully amortizing): n = repayYears × 12 repayMonthly = balance × (r(1+r)^n) / ((1+r)^n − 1) (if r = 0 → balance / n) totalRepayInterest = repayMonthly × n − balance Payment shock = repayMonthly − interestOnlyMonthly Total interest = totalDrawInterest + totalRepayInterest
Assumptions
- Variable rate modeled as fixed at the rate you enter — real payments will change as the prime rate moves.
- Full balance assumed drawn for the entire draw period — partial draws or paydowns during the draw period are not modeled.
- No additional principal payments made during the draw period — interest-only treatment for the full draw term.
- No fees (origination, annual, or inactivity fees) are included in the interest calculation.
- Market context: the New York Fed's Q2 2026 Household Debt and Credit Report counted $459 billion in loans outstanding on home equity lines of credit nationally — up 2.8% for the quarter and 11.6% year-over-year — with Freddie Mac's weekly survey putting the 30-year fixed mortgage rate at 6.65% on loans as of August 20, 2026, the reference point driving many homeowners toward a HELOC instead of a cash-out refinance.
Worked examples
Typical HELOC — $50,000 at 8.5% APR
- HELOC balance
- $50,000
- APR
- 8.5%
- Draw period
- 10 years
- Repayment period
- 20 years
Draw-period payment: $354.17/mo (interest only). Repayment-period payment: $433.91/mo. Payment shock: +$79.74/mo when draw ends. Total interest over full 30-year life: ~$96,639.
Larger renovation HELOC — $100,000 at 9% APR
- HELOC balance
- $100,000
- APR
- 9.0%
- Draw period
- 10 years
- Repayment period
- 15 years
Draw-period payment: $750.00/mo. Repayment-period payment: $1,014.27/mo. Payment shock: +$264.27/mo. Total interest over 25-year life: ~$172,568.
Frequently asked
Questions readers ask
How is a HELOC payment calculated? +
During the draw period, your monthly payment is interest-only: balance × (APR ÷ 12). At 8.5% APR on a $50,000 balance that's $354.17/month. When the draw period ends, the outstanding balance converts to a fully amortizing loan for the repayment period — the standard amortization formula applies: payment = balance × (r(1+r)^n) / ((1+r)^n − 1), where r is the monthly rate and n is the number of repayment months.
What is the difference between the draw period and the repayment period? +
The draw period (typically 5–15 years) is when you can borrow from the line and are required to pay only accrued interest each month. Your principal balance does not decrease during this period unless you make additional principal payments. The repayment period (typically 10–20 years) begins when the draw period closes — you can no longer borrow, and your remaining balance is amortized into fixed monthly P+I payments over the repayment term.
Why does my HELOC payment jump after the draw period? +
During the draw period you pay interest only — your principal is untouched. When the repayment period begins, you must pay down that entire principal balance plus interest in a compressed timeframe. The payment shock (the increase in your monthly obligation) can be substantial. For example, on a $50,000 balance at 8.5% APR with a 10-year draw and 20-year repayment, the jump is roughly $80/month — but on a $200,000 balance the same shock is ~$320/month. The shorter the repayment period, the steeper the shock.
Are HELOC rates fixed or variable? +
Most HELOCs carry a variable rate tied to the U.S. prime rate (itself tied to the federal funds rate). When the Fed raises or lowers rates, your HELOC rate — and therefore your payment — moves with it. Some lenders offer rate-lock features that let you convert all or part of the outstanding balance to a fixed-rate sub-account. Check your lender's agreement for the floor rate, ceiling rate, and rate-adjustment terms.
Is HELOC interest tax-deductible? +
Under IRS Publication 936, HELOC interest is deductible only when the borrowed funds are used to 'buy, build, or substantially improve' the home that secures the loan (subject to the $750,000 combined acquisition debt limit for mortgages originated after December 15, 2017). Interest on a HELOC used for other purposes — paying off credit cards, funding a vacation, or buying a car — is not deductible under current law. Consult a qualified tax advisor for your specific situation.
This tool is for educational purposes only and is not financial, legal, or tax advice. Final terms and eligibility depend on lender underwriting; consult a tax professional before acting on tax-tool output. ClearValue Lending is a funding platform.
https://clearvaluelending.com/tools/heloc-payment-calculator