Calculate home equity loan payments, APR, and estimate your borrowing limit. Enter your home value, mortgage balance, and rate to see how much you can borrow with a fixed-rate second mortgage in 2026.
This tool is for homeowners who want a one-time lump sum borrowed against the equity they've built. You enter your home's current value, your remaining first-mortgage balance, an interest rate, and a repayment term, and it returns your maximum borrowing amount, the fixed monthly payment, and total interest over the life of the loan. A home equity loan is a second mortgage with a fixed rate and fixed payments, distinct from a flexible credit line you draw on as needed. The calculator uses the combined loan-to-value limit lenders rely on, typically 85%, to cap how much you can take. Home equity loan rates averaged in the high-7% range in mid-2026, with strong-credit borrowers qualifying lower. Use it to plan a renovation, consolidate debt, or compare a lump-sum loan against other options.
Getting your borrowing power takes only a minute with a few figures from your latest statement. Step through it:
Enter your home's current value.
Use a recent appraisal or a reliable online estimate.
Input your mortgage balance.
This is what you still owe on your first mortgage today.
Set the loan-to-value limit.
Most lenders cap combined borrowing at 85%; adjust if yours differs.
Add the interest rate.
Home equity loan rates ran near 7.8% in mid-2026, lower for excellent credit.
Choose a repayment term.
Common terms run 5 to 30 years; shorter terms mean higher payments but less total interest.
Review your results.
See your maximum loan amount, fixed monthly payment, and total interest.
Lower the loan amount below your maximum to see how borrowing less shrinks both your payment and your interest.
Two simple steps drive the result. First, the calculator finds your available equity using the combined loan-to-value cap. It multiplies your home value by the limit, then subtracts your existing mortgage:
Max Borrowing = (Home Value × 85%) − Current Mortgage Balance
So on a $400,000 home with a $250,000 mortgage, the math is ($400,000 × 0.85) − $250,000 = $340,000 − $250,000 = $90,000 available. Next, it calculates a fixed monthly payment on the amount you choose to borrow, using standard amortization across your chosen term:
Monthly Payment = Loan Amount amortized at your rate over the term
Here's what that actually means: because the rate is fixed, your payment never changes, unlike a variable line of credit. The calculator multiplies that steady payment across every month and subtracts your principal to show total interest. A longer term lowers the monthly bill but quietly inflates how much interest you hand the lender over the years, which is the trade-off worth studying before you sign.
The two headline numbers — how much you can borrow and the fixed payment — tell you whether a home equity loan fits your plan. The borrowing figure is a ceiling, not a target; pulling out the maximum stacks a large second payment on top of your existing mortgage and shrinks your equity cushion. The fixed payment is the appealing part: it never moves, so budgeting is straightforward, which is exactly why people choose this over a variable-rate line. Watch the total-interest figure closely. A 20-year term feels gentle month to month but can cost far more interest than a 10-year payoff on the same balance. Because your house secures the loan, falling behind risks foreclosure, so treat the payment as a serious fixed obligation, not optional spending. If the monthly number strains your budget, borrow less than the maximum or stretch the term, knowing each choice has a cost.
Your borrowing power and payment hinge on a few inputs:
A higher appraisal expands your available equity directly. A recent comparable-sales estimate keeps your number realistic.
The more you still owe, the less equity is left to borrow against under the 85% cap.
Some lenders allow 80%, others up to 90%; the cap sets your maximum loan.
Home equity loan rates depend heavily on your credit score; strong credit can shave a full point or more off the average.
A shorter term raises the monthly payment but slashes total interest paid.
Lenders price your rate and approve your limit partly on credit and existing obligations, so both shape the offer you actually receive.
The Garcias own a home worth $450,000 with $200,000 left on their mortgage. At an 85% combined loan-to-value cap, their ceiling is ($450,000 × 0.85) − $200,000 = $182,500. They only need $60,000 for the renovation, so they borrow that at 7.8% over 15 years. The fixed monthly payment is about $566, and they'll pay roughly $41,900 in total interest. Borrowing well under their maximum keeps a healthy equity buffer and a manageable second payment alongside their first mortgage.
Tony owes $35,000 across credit cards averaging 22% interest. His home is worth $320,000 with a $180,000 mortgage, giving a borrowing ceiling of ($320,000 × 0.85) − $180,000 = $92,000. He takes a $35,000 home equity loan at 7.5% over 10 years, with a fixed payment near $415 and about $14,800 in total interest. Swapping 22% card debt for a 7.5% fixed loan saves him a fortune in interest — but he's now secured that debt against his house, so missing payments carries far higher stakes.
A home equity loan is powerful when used deliberately. Keep these in mind:
Borrow only what you need. Your maximum is a limit, not a goal. A smaller loan means a smaller payment and less interest.
Favor a shorter term if you can afford it. Ten years instead of twenty can save many thousands in interest on the same balance.
Reserve it for high-value uses. Renovations that add value or consolidating expensive debt make sense; vacations and everyday spending don't.
Shop your rate aggressively. Rates range widely by lender and credit; a single point saved compounds across the whole term.
Protect your equity cushion. Leaving room below the 85% cap shields you if home values dip.
Remember the collateral. This loan is tied to your home, so build the payment into your budget as non-negotiable.
Most lenders let you borrow up to 85% of your home's value minus your current mortgage balance. On a $400,000 home with a $250,000 mortgage, that's about $90,000. Your credit and income can lower the amount you actually qualify for.
A home equity loan calculator multiplies your home value by the loan-to-value cap, usually 85%, then subtracts your existing mortgage to find your maximum. It then amortizes the amount you borrow at a fixed rate over your chosen term. The result is a steady monthly payment and a total interest figure.
In mid-2026, home equity loan rates averaged in the high-7% range, with borrowers who have strong credit qualifying closer to 6.5%. Anything at or below the national average is reasonable. Shopping several lenders is the best way to beat the average.
A home equity loan gives you a lump sum at a fixed rate with fixed payments, while a HELOC is a revolving credit line with a variable rate you draw on as needed. Choose the loan for one-time, predictable expenses. Choose a line of credit for ongoing or uncertain costs.
Yes, a home equity loan is a type of second mortgage because it's a separate loan secured by your home behind your first mortgage. If you default, the first mortgage gets paid first in a foreclosure. That subordinate position is part of why rates run higher than a primary mortgage.
Yes, many homeowners use a home equity loan to replace high-rate credit card debt with a much lower fixed rate. The interest savings can be substantial. The trade-off is that you've secured that debt against your home, raising the stakes if you can't pay.
The main risk is that your home secures the loan, so missed payments can lead to foreclosure. Borrowing the maximum also reduces your equity cushion if home values fall. Keeping the loan modest and the term sensible limits the downside.
Brief disclaimer: This calculator provides estimates for educational and planning purposes only. Actual loan amounts, rates, and terms depend on your lender, credit profile, and property appraisal. Results should be treated as planning guidance rather than financial or mortgage advice.