Estimate a U.S. fixed-rate home equity loan payment, CLTV fit, net cash after closing costs, and key amortization checkpoints. Use it to test different inputs quickly, compare outcomes, and understand the main factors behind the result before moving on to related tools or deeper guidance.
Estimate a fixed-rate home equity loan payment, check whether the requested second mortgage
fits inside a combined-LTV screen, and see how much cash actually reaches the borrower
after closing-cost treatment.
Home equity loan assumptions
This worksheet models a U.S. fixed-rate home equity loan, also called a closed-end second
mortgage. It assumes one lump-sum disbursement, a fixed note rate, and fully amortizing
monthly payments over the selected term.
Enter home equity loan details Enter a home value, current mortgage balance, requested loan amount, and note rate to estimate the fixed monthly payment and CLTV fit for a home equity loan.
Home equity loan calculator guide: fixed payment, CLTV screening
A home equity loan calculator should do more than show one monthly payment. This page estimates whether a fixed-rate second mortgage fits inside a combined loan-to-value screen, how closing costs affect the note balance or cash to the borrower, and what the amortization path looks like over the full term.
What this home equity loan calculator is estimating
A home equity loan is usually a closed-end second mortgage secured by the borrower's equity in the property. In the United States, lenders often screen the request by combining the first-mortgage balance and the new second mortgage, then checking that total against a maximum combined loan-to-value ratio. That makes CLTV one of the first planning questions, not a detail that can be checked after the payment is calculated.
The other practical question is the shape of the cash. A home equity loan is usually a one-time lump-sum disbursement with a fixed rate and fully amortizing payment. That is different from a HELOC, where the line can revolve and the payment can change sharply between the draw period and the repayment period. Users searching for a home equity loan payment calculator are typically deciding whether they want the predictability of a fixed second mortgage and how much cash would actually be available after costs.
This page is intentionally scoped to U.S. mortgage-style home equity lending. It uses combined-LTV screening and fixed-rate second-mortgage framing common in the United States. It is not a universal home-equity tool and should not be treated as if home-secured borrowing works the same way in every country.
How the loan amount, CLTV, and payment are calculated
The worksheet begins with the selected combined-LTV screen. It multiplies the home's value by the maximum combined loan-to-value percentage and subtracts the current first-mortgage balance to estimate how large the second mortgage could be before fees. If the borrower chooses to finance closing costs, those costs are added to the note balance and consume part of that available room. If the borrower pays costs upfront, the note stays smaller but the cash needed at closing rises.
Once the gross loan balance is known, the monthly payment is calculated using the standard amortization formula for a fixed-rate installment loan. The page also shows total interest over the full term, the note balance that appears on the second mortgage, the net cash that actually reaches the borrower, and how much CLTV headroom remains after the transaction closes. That structure matters because two scenarios with the same requested cash proceeds can lead to different note balances and different payments depending on whether fees are financed.
The result is still a planning model. It does not decide whether a lender will offer the selected CLTV, approve the borrower, or require different fees or reserve rules. It simply makes the fixed-payment and cash-versus-fee trade-offs visible before a formal Loan Estimate arrives.
Maximum second mortgage before fees = Home value x max combined LTV - current mortgage balance
This estimates how much room is available for a fixed second mortgage before considering financed fees.
Worked example: 400,000 home value, 250,000 mortgage balance, and 50,000 requested cash
Suppose a borrower estimates the property is worth 400,000, still owes 250,000 on the first mortgage, chooses an 80% combined-LTV screen, requests 50,000 of cash, enters 3,000 of closing costs, and tests a 15-year fixed rate of 8%. An 80% CLTV screen implies maximum combined debt of 320,000. Subtracting the current 250,000 mortgage balance leaves 70,000 of room for the second mortgage before fees.
If the borrower finances the 3,000 of closing costs, the second-mortgage note becomes 53,000 and the fixed monthly payment is roughly 506.56 over 15 years. The borrower still receives the full 50,000 of cash because the costs were rolled into the loan. The combined LTV after closing is about 75.75%, which remains inside the selected screening cap. If the same borrower paid costs upfront instead, the note would stay at 50,000, the monthly payment would be lower, but 3,000 of cash would be needed at closing and the net proceeds would be smaller.
That is why the closing-cost treatment is not just an accounting detail. Financing costs protects the cash proceeds but raises the note balance and interest paid over time. Paying costs upfront preserves a smaller loan and lower payment, but reduces the immediate liquidity the borrower takes away from closing.
This page is a planning estimate, not an underwriting engine. It does not test credit score, debt-to-income ratio, reserves, occupancy, appraisal outcome, lien-position rules, lender overlays, tax consequences, or title and recording requirements. Those factors can change whether the loan is available at all and can materially change the final closing-cost package.
It also does not decide whether a home equity loan is the right product. Some borrowers may be comparing a fixed second mortgage with a HELOC, a cash-out refinance, or an unsecured personal loan. Use this worksheet to understand the fixed-payment and CLTV mechanics, then compare it with the lender's Loan Estimate and with alternative borrowing structures before committing to a mortgage-secured debt decision.
No. A home equity loan is usually a lump-sum second mortgage with a fixed rate and fixed monthly payment. A HELOC is usually a revolving line that may have a draw period, a later repayment period, and often a variable rate. The two products are both secured by home equity, but they behave very differently once the loan is active.
Why does financing closing costs increase the payment so much?
Because financed costs become part of the second-mortgage note balance. The borrower may still receive the same requested cash amount, but the loan principal is larger, so more interest accrues and the fixed monthly payment rises. The calculator shows both the gross note balance and the net borrower proceeds so that trade-off stays visible.
What is a typical combined-LTV limit for a home equity loan?
Many U.S. lenders screen home equity loans around 80% to 85% combined LTV, with some offers extending higher for stronger borrowers or specific programs. There is no universal maximum that applies to every lender and every borrower. The selected CLTV in this worksheet is a planning screen, not a promise that the lender will approve that exact structure.
Can this calculator replace a lender's Loan Estimate?
No. It is a screening tool for payment, CLTV, and cash-versus-fee trade-offs. A real Loan Estimate can include different rates, fees, timing assumptions, and eligibility conditions, and it reflects the lender's actual underwriting and disclosure package. Use this page to frame the questions, then verify the real transaction with the lender's documents before closing.
