How Much Will a HELOC Let Me Borrow?

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A home equity line of credit (HELOC) is an important credit access tool you can use anytime and repay at variably low-interest rates depending on your home’s equity and credit score. 

HELOCs are best for homeowners needing home improvement funds or more time to clear debts. Using a heloc loan calculator today can help you answer the most important questions, such as your HELOC loan limit and HELOC payments. 

Here is everything you must know about how it is calculated, how much a HELOC will let you borrow and what you need to qualify for the maximum amount

How Much HELOC Could You Borrow?

You would use a HELOC mainly to borrow money with your home’s equity as collateral. A portion of your home’s values serves as your credit limit when applying for HELOC. 

Although some lenders might allow loan access of up to 90% of the home’s equity, though with a higher interest rate, most HELOC lenders allow between 80% and 85%, depending on your credit score and down payments. Ideally, they ensure that the combined HELOC limit and the outstanding mortgage balance are below 80% or 85% of your home’s most recent appraised value.

Unfortunately, HELOC loan limits vary depending on the lender’s guidelines. For instance, some lenders have imposed a dollar limit and CLTV limits for their HELOCs. Therefore, knowing your loan-to-value (CLTV) can help determine your HELOC loan’s interest rates.

Use a HELOC Loan Calculator to know How Much HELOC Could You Borrow?

You will need four essential pieces of information: your current mortgage balance, home address, credit score range, and desired HELOC loan amount to use the HELOC calculator at 

Follow the following four steps to get answers such as your HELOC loan amount and interest rates:

  1. Home valuation: Get an estimate for your home using a third-party valuation service called House Canary. Enter your property address for House Canary to estimate your home’s value. You can adjust the property value if House Canary does not have your home’s data.
  2. Current Mortgage Balance: Determine your loan payoff for all the outstanding mortgage balances. Determine what you owe against your home’s equity by considering any financing, such as existing HELOCs, second mortgages, and equity loans that use the home as collateral. You should exclude a HELOC or home equity in the balance if you plan to refinance an existing HELOC or home equity loan with the new HELOC.
  3. Enter The Desired Loan Amount: You can always use the heloc loan calculator to estimate and determine the maximum amount you can borrow. Expect an error message if you input an amount that exceeds the prescribed amount that the HELOC lender can allow you to borrow.
  4. Determine the Credit Score Range: You can determine the interest rate your HELOC lender will offer by inputting your credit score.

How To Increase your HELOC Amount

The maximum loan amount for your HELOC loan you can borrow depends on the following factors:

  • Individual HELOC lender’s guidelines
  • Your credit scores
  • Your home’s equity value.

Although most lenders do not allow you to use at least 20% of your home’s equity for collateral, some will let you borrow on this retained equity. However, it raises the loan-to-value ratio and increases interest rates for your HELOC.

On the Bottom line

A calculator for your heloc loan is an important tool in helping you get answers to questions such as, “how much will a HELOC let me borrow?” However, the total HELOC loan you can get depends on factors such as your overall creditworthiness and home equity value at the time of borrowing. Your HELOC loan lender will assess your risk of borrowing and consequently determine interest rates and the amount you can borrow before approval.