HELOC Payment Calculator
Calculate draw period and repayment period payments, see the payment shock when your HELOC converts, and view the full year-by-year amortization schedule.
HELOC Payment Calculator
Detailed calculation showing draw period payments, repayment period payments, total interest, and full amortization.
Draw Period Payment
$583.33
Interest only / month
Repayment Period Payment
$706.97
Principal + interest / month
Interest in Draw
$70,000
Interest in Repay
$89,672
Total Interest
$159,672
Draw Period (10 years)
- Monthly payment
- $583.33
- Total payments
- $70,000
- Total interest
- $70,000
- Balance at end
- $80,000
Repayment Period (20 years)
- Monthly payment
- $706.97
- Total payments
- $169,672
- Total interest
- $89,672
- Balance at end
- $0
Calculations assume the full draw amount is borrowed at once. HELOC rates are variable - actual payments will change with interest rate movements.
Draw Period vs Repayment Period
Understanding both phases prevents surprises when your HELOC converts.
Draw Period
Typically 5 to 10 years
You can borrow up to your credit limit, repay, and borrow again. Most lenders require interest-only payments. Your monthly payment fluctuates with your balance and the variable rate.
Repayment Period
Typically 10 to 20 years
The credit line closes. Your outstanding balance converts to a fully amortizing loan. Monthly payments jump substantially to cover both principal and interest repayment.
Payment Shock - Plan Ahead
The biggest financial risk with a HELOC is payment shock when the draw period ends. If you borrowed $100,000 at 8.75% and made only interest-only payments for 10 years, your monthly payment roughly doubles when repayment begins. Use the calculator above to see your exact numbers and plan accordingly - either by paying down principal during the draw period or refinancing before repayment begins.
Frequently Asked Questions
How is a HELOC payment calculated?
During the draw period, most HELOCs require interest-only payments calculated as: balance drawn multiplied by (annual rate divided by 12). For example, $80,000 at 8.75% equals $583.33 per month in interest. During repayment, the balance amortizes fully over the remaining term, similar to a standard mortgage payment calculation.
What is the difference between the draw period and repayment period?
The draw period (typically 5 to 10 years) is when you can borrow from your credit line and usually pay interest only. The repayment period (typically 10 to 20 years) begins when the draw period ends. You can no longer borrow and must repay the outstanding balance in full with principal and interest payments.
How does a variable HELOC rate work?
Most HELOCs use a variable rate tied to the prime rate plus a lender margin. For example, if the prime rate is 7.5% and the margin is 1.25%, your rate is 8.75%. When the Federal Reserve changes the federal funds rate, the prime rate adjusts and your HELOC payment changes accordingly, usually within one to two billing cycles.
What happens if I only make minimum payments during the draw period?
If you make interest-only payments during the draw period, your balance stays exactly at the amount you borrowed. When repayment begins, you face significantly higher monthly payments because you must now repay the full principal over a shorter remaining term. This payment shock can be avoided by making additional principal payments during the draw period.
Can I pay off my HELOC early?
Yes. There is no legal restriction on early HELOC repayment and most HELOCs do not have prepayment penalties. However, some lenders charge a fee if you close the line within the first 2 to 3 years. Making extra principal payments during the draw period reduces your balance and lowers your future repayment amount significantly.
Is HELOC interest tax deductible?
HELOC interest is deductible only if the funds are used to buy, build, or substantially improve the home securing the loan. Using HELOC funds for other purposes such as paying off credit cards, funding education, or purchasing a car does not qualify for the deduction under current IRS rules. Always consult a tax advisor for your specific situation.