HELOC Calculator
Calculate your real Home Equity Line of Credit payment with current Curinos rates. Includes the interest-only draw period, the principal-and-interest repayment period, and the payment shock at the transition that catches most borrowers off guard.
Last updated: April 2026 · Source: Curinos national HELOC and HEL rate averages
Your home and equity
Most lenders allow 80-85%. Some go to 90%.
Your HELOC terms
National average: 7.2%. Range typically 6%-18%.
Where HELOC rates stand right now
HELOC rates are tied to the prime rate, which currently sits at 6.75%. Most lenders price HELOCs as prime plus a margin somewhere between 0.45% and 1.50%, depending on your credit score and combined loan-to-value ratio. Curinos reports the national average HELOC rate at 7.2% as of early April 2026, with the 52-week low of 7.19% recorded in mid-January. Fixed-rate home equity loans average 7.47%.
For homeowners with a low primary mortgage rate from the 2020-2021 era, this is one of the best moments to consider tapping equity. A HELOC lets you keep that 3% pandemic mortgage untouched and only pay current rates on the equity you actually need. According to the Federal Reserve Bank of St. Louis, US homeowners collectively held about $35 trillionin home equity at the end of 2024 — a massive pool of borrowing power that mostly sits idle because rate-and-term refinancing makes no sense for borrowers with sub-5% existing loans.
The catch: HELOC rates are variable. If the Fed raises rates, your payment goes up the next billing cycle. Borrowers who took out HELOCs at 4-5% in 2021 watched their rates climb past 9% by mid-2024 before settling into the current 7% range. Build a buffer for rate movement into your monthly budget before you draw funds.
How HELOC payments actually work
A HELOC has two phases. The first is the draw period, usually 10 years, during which you can borrow up to your credit limit and most lenders only require interest-only payments. The second is the repayment period, usually 20 years, during which you can no longer draw and you must pay both principal and interest until the balance is gone. Total HELOC term: typically 30 years.
Repayment payment = Standard amortization over repayment years
Worked example. You borrow $50,000 from your HELOC at the current average rate of 7.20%. During the 10-year draw period, your monthly minimum is interest-only: $50,000 × 7.20% / 12 = $300/month. None of that touches principal. After 10 years, you still owe the full $50,000. The repayment period kicks in, and the same $50,000 is now amortized over 20 years at 7.20%. Your new payment: $394/month — a 31% jump that catches a lot of people off guard.
On a shorter 10-year repayment, the shock is worse: $50,000 over 10 years at 7.20% is about $586/month, nearly double the draw-period payment. The fix is simple but most borrowers ignore it: pay more than the interest-only minimum during the draw period to chip away at principal before the repayment period begins.
HELOC vs home equity loan vs cash-out refinance
| Feature | HELOC | Home equity loan | Cash-out refi |
|---|---|---|---|
| Average rate (April 2026) | 7.2% variable | 7.47% fixed | ~6.71% fixed |
| Structure | Revolving line | Lump sum | Replaces mortgage |
| Closing costs | $0-$500 | $500-$2,000 | 2-5% of loan |
| Affects existing mortgage? | No | No | Yes (replaced) |
| Best for | Ongoing/unknown amounts | One-time fixed expense | High existing rate |
If your existing mortgage rate is below 5%, almost never do a cash-out refi. Use a HELOC or home equity loan instead.
Four real-world HELOC scenarios
1. The kitchen remodel ($60K over 3 years)
The Garcia family has a 3.1% pandemic-era mortgage and $300,000 in equity. They open a $80,000 HELOC at 7.25% for a phased kitchen remodel. They draw $20,000 in year one, $25,000 in year two, $15,000 in year three. By the end of year three they have borrowed $60,000, paid roughly $7,200 in interest along the way, and they aggressively pay it off over the next 4 years. Total cost: about $74,000. They never gave up the 3.1% mortgage.
2. The "I'll just pay interest" mistake
James draws $75,000 from his HELOC at 7.20% to consolidate credit cards and fix the roof. For 10 years he makes only the interest-only payment of $450/month, comfortable and manageable. Then year 11 hits. The repayment period begins, his payment jumps to $591/month over 20 years, and his budget cannot absorb a $141/month increase plus the loss of deductible flexibility. He ends up refinancing the HELOC into another HELOC just to reset the draw period and avoid the shock — kicking the can down the road.
3. The credit card consolidation that worked
Maya has $40,000 in credit card debt at an average 24% APR, costing her $800/month in interest alone. She opens a $50,000 HELOC at 7.20% and pays off all the cards. New interest: $300/month. She redirects the $500/month savings entirely to principal on the HELOC, paying it off in roughly 8 years. Critically, she also closed half her credit cards and put the rest in a drawer. Without addressing the spending behavior, the math does not work — the cards just fill back up.
4. The variable-rate sting
Chen opened a $100,000 HELOC in late 2021 at 4.25% — prime was 3.25% then, plus a 1% margin. Within 18 months, the Fed had hiked rates 11 times. Prime jumped to 8.50%, and Chen's HELOC rate climbed to 9.50%. His interest-only payment on a $60,000 balance went from $213/month to $475/month — more than doubling. He drew faster than he could repay, and rate movement made it worse. The lesson: if you cannot afford your HELOC at prime plus 4-5%, do not draw the full amount.
Common mistakes when calculating HELOC payments
1. Only looking at the interest-only payment
The cheap draw-period payment is a feature designed to make borrowing feel painless. The real cost shows up in the repayment period. Always calculate both before borrowing.
2. Assuming the rate stays put
HELOC rates are variable. They can move 2-3% in either direction over the life of the loan. Stress-test your payment at prime + 4% before you draw.
3. Drawing the full credit limit "just in case"
You only owe interest on what you borrow. If you draw $80,000 and only need $50,000, you are paying interest on $30,000 of dead weight. Draw what you need, when you need it.
4. Forgetting that the home is the collateral
If you cannot pay, the lender can foreclose. HELOCs feel like credit cards but they are not. Treat the debt with the same seriousness as your primary mortgage.
5. Ignoring annual fees and inactivity charges
Many HELOCs charge $50-$100 per year just to keep the line open, and some charge inactivity fees if you do not draw funds. Read the disclosures.
6. Using it for discretionary spending
A HELOC for a kitchen remodel is using equity to potentially increase home value. A HELOC for a vacation is converting equity into a depreciating memory. The math punishes the second one.
Frequently asked questions
What is a HELOC and how does it work?
A HELOC (Home Equity Line of Credit) is a revolving line of credit secured by your home, similar to a credit card but with much lower interest rates. You are approved for a credit limit based on your equity, and you can borrow against it as needed during the "draw period" (typically 10 years). After the draw period ends, you enter a "repayment period" (typically 20 years) where you can no longer borrow and you must repay both principal and interest on what you owe.
What is the average HELOC interest rate in April 2026?
According to real estate analytics firm Curinos, the national average HELOC rate is currently 7.20% (variable), with the 52-week low of 7.19% recorded in mid-January 2026. The national average for a fixed-rate home equity loan is 7.47%. These averages are based on borrowers with credit scores above 780 and combined loan-to-value ratios below 70%. Actual rates range from about 6% to as high as 18% depending on creditworthiness and the lender.
How much can I borrow with a HELOC?
Most lenders allow you to borrow up to 80-85% of your home value, minus what you still owe on your primary mortgage. This is called the combined loan-to-value (CLTV) ratio. Example: if your home is worth $500,000 and you owe $300,000 on your mortgage, an 85% CLTV gives you a maximum HELOC of $125,000 ($500,000 × 0.85 = $425,000 - $300,000 mortgage = $125,000). Some lenders go up to 90% or even 100% CLTV for borrowers with excellent credit, but these come with higher rates.
What is the difference between a HELOC and a home equity loan?
A HELOC is a revolving credit line with a variable rate — you draw funds as needed and only pay interest on what you have actually borrowed. A home equity loan (HEL) is a fixed-rate lump sum — you receive all the money at closing and start making fixed P&I payments immediately. Use a HELOC for ongoing or unpredictable expenses like a multi-year remodel. Use a home equity loan for a one-time known expense where you want payment certainty.
How does the HELOC draw period work?
The draw period is the first phase of a HELOC, typically 10 years. During this time you can borrow up to your credit limit, repay it, and borrow again as many times as you want. Most lenders only require interest-only payments during the draw period — meaning if you borrow $50,000 at 7.20%, your minimum monthly payment is just $300, none of which goes to principal. This makes draw-period payments feel cheap, but it sets up a painful surprise when the repayment period begins.
What is "payment shock" at the end of the draw period?
When the draw period ends and the repayment period begins, your payment can double or triple overnight. Example using current rates: $50,000 borrowed at 7.20% costs about $300/month interest-only during the draw period. Once the 20-year repayment period kicks in, the same balance now requires roughly $394/month in P&I — a 31% jump. On a 10-year repayment, the same balance jumps to about $586/month — a 95% increase. Borrowers who only made interest-only payments for 10 years often have a hard time absorbing this.
Are HELOC interest rates fixed or variable?
Most HELOCs have variable rates tied to the prime rate plus a margin set by the lender. The prime rate is currently 6.75%, so a HELOC with a 0.45% margin would carry a rate of 7.20%. When the Federal Reserve adjusts the federal funds rate, the prime rate moves with it, and your HELOC payment changes the next billing cycle. Some lenders offer fixed-rate HELOCs or let you convert all or part of your balance to a fixed rate, usually at a higher initial rate.
Is HELOC interest tax deductible in 2026?
Under current IRS rules from the Tax Cuts and Jobs Act, HELOC interest is only deductible if the funds are used to "buy, build, or substantially improve" the home that secures the loan. Using a HELOC to pay off credit cards, fund a vacation, pay tuition, or buy a car does not qualify. You also need to itemize deductions to benefit, which fewer households do since the standard deduction was increased. Talk to a tax professional about your specific situation.
When does a HELOC make more sense than a cash-out refinance?
A HELOC almost always wins over a cash-out refinance when you have a low primary mortgage rate (under 5%) that you do not want to give up. Cash-out refinancing replaces your entire mortgage at current rates, which means a homeowner with a 3% pandemic-era mortgage would be trading it for a 6.46% loan to access equity. A HELOC keeps the existing mortgage untouched and only charges current rates on the equity you actually borrow. For homeowners with a 7%+ original rate, cash-out refi may be cheaper.
What are the closing costs on a HELOC?
HELOC closing costs are typically much lower than mortgage refinance closing costs, often $0 to $500. Many lenders waive closing costs entirely as a promotion. Watch for an annual fee ($50-$100), an inactivity fee if you do not draw funds, and a "early closure fee" of $300-$500 if you close the line within 2-3 years of opening. The cheapest HELOC by interest rate is not always the cheapest by total cost — read the fine print.
Can I lose my house if I cannot pay my HELOC?
Yes. A HELOC is a second mortgage secured by your home, just like your first mortgage. If you fail to pay, the HELOC lender has the right to foreclose. Because the first mortgage gets paid first in foreclosure, HELOC lenders may be more aggressive about collecting if your home value has dropped close to your combined loan balance. Treat HELOC debt with the same seriousness as your primary mortgage.
How can I avoid the payment shock at the end of the draw period?
The simplest fix: pay down principal during the draw period instead of just paying interest. If you draw $50,000 and pay $500/month (instead of the $300 interest-only minimum), you will be paying down the balance and the eventual repayment-period payment will be much smaller. The other option is to refinance the HELOC into a new HELOC or a home equity loan before the repayment period begins, resetting the structure. Some lenders offer this conversion in-house.
Data sources: Curinos national HELOC and home equity loan rate averages (April 2026); Federal Reserve Bank of St. Louis (FRED) US homeowner equity totals; Bankrate HELOC draw period guide; NerdWallet HELOC rate analysis April 2026; Yahoo Finance daily HELOC rate updates April 2026.
Last updated: April 2026. HELOC rates change weekly with movements in the prime rate. Individual lender quotes may vary by 0.5-2% from the national average.
Disclaimer: This calculator provides estimates for educational purposes only and is not financial advice. Borrowing against your home is risky and can result in foreclosure if you fail to repay. Consult a qualified mortgage professional before opening a HELOC.