Line of Credit Payment Calculator

How it works

Interest-only payment = balance × (APR ÷ 12) · Full repayment payment = B × r ÷ (1 − (1 + r)^−n), r = APR ÷ 12, n = years × 12 · B = balance when repayment starts (after any draw period, new draws and principal paid) · Other frequencies: r = APR ÷ periods per year, n = years × periods per year

A line of credit, such as a HELOC or a personal or business line, usually has two phases. During the draw period you can keep borrowing and often owe only the interest on what you have used, which keeps payments low but leaves the balance where it is. In the repayment period the balance is turned into level payments over a set term, like an ordinary loan. The calculator shows both payments, then runs the line month by month: the draw period first (interest only, interest plus a percent of the balance, or a flat percent, with any new draws you expect), then repayment over your term or at a fixed payment you choose. Because most lines have a variable rate, you can add a rate change for the repayment phase and see the payment at 2 points higher. Extra payments, other payment frequencies, a credit limit, and upfront and annual fees are under More options. Fees are turned into an APR that counts them.

Worked example

With $25,000 drawn at 9% APR, the interest-only payment is 25,000 × (9% ÷ 12) = $187.50 a month. To repay the full $25,000 over 10 years, the payment rises to $316.69 a month, with $13,002.73 of interest over 120 payments. If 5 years of interest-only draw period are left, you pay $11,250 of interest first and then the same $316.69 for 10 years, $24,252.73 of interest in all. If the rate rose 2 points to 11%, the 10-year payment would be $344.38.

Sources: CFPB — What you should know about home equity lines of credit (HELOC) · CFPB — What is a home equity line of credit (HELOC)?

Frequently asked questions