To calculate the monthly payment on a $50,000 HELOC, you need to know the interest rate and the loan term length. For example, if the interest rate is 9% and the loan term is 30 years, the monthly payment would be approximately $402.
Calculating the monthly cost for a $50,000 loan at an interest rate of 8.75%, which is the average rate for a 10-year fixed home equity loan as of September 25, 2023, the monthly payment would be $626.63. And because the rate is fixed, this monthly payment would stay the same throughout the life of the loan.
To illustrate, here's what the costs would be on a $75,000 HELOC for both 10- and 15-year repayment periods: 10-year HELOC at 9.37%: $965.15 monthly, totaling $40,818.17 in interest paid. 15-year HELOC at 9.37%: $777.30 monthly, totaling $64,913.27 in interest paid.
While home loan interest rates overall have risen dramatically since 2022, HELOC rates still tend to be lower than those on credit cards and personal loans. If you qualify for the best rates, a HELOC can be a less expensive way to consolidate debt or finance a home renovation.
HELOC payment examples
For example, payments on a $100,000 HELOC with a 6% annual percentage rate (APR) may cost around $500 a month during a 10-year draw period when only interest payments are required. That jumps to approximately $1,110 a month when the 10-year repayment period begins.
But if your HELOC rate and payment stayed the same through the 15-year repayment period, your HELOC payments on a $60,000 balance at today's average interest rate of 9.18% would be $615 per month and you would pay $50,700.25 in total interest. Get the money you need with a home equity loan now.
A home equity line of credit or HELOC is another type of second mortgage loan. Like a home equity loan, it's secured by the property, but there are some differences in how the two work. A HELOC is a line of credit that you can draw against as needed for a set period of time, typically up to 10 years.
Here's what qualified borrowers can expect to pay monthly for a $25,000 HELOC at today's interest rate: 10-year HELOC at 8.73%: $313.05 per month. 15-year HELOC at 8.73%: $249.57 per month.
In general, to qualify for a $50,000 personal loan you will need to show you have sufficient income to make the monthly payments and have a credit score of 580 or higher. You also must be 18 years old and a U.S. citizen, legal resident, or visa holder.
While qualifying for a HELOC depends more on your home equity than your credit score, good or excellent credit can simplify the process and make it a lot easier to qualify for a HELOC. A good average to shoot for is 645 or higher. Plus, the better your credit score, the better your interest rate.
You can pay off your HELOC early, but be mindful of pre-payment fees, if any. If you have a Citizens HELOC, you're in luck as Citizens does not charge pre-payment fees. HELOCs allow you to make interest-only payments during the draw period, then transition to principal and interest payments during the repayment period.
Since the end of September, HELOCs have been trading below 9 percent and, along with home equity loans, they're forecast to retreat further in 2024. At its Dec. 17-18 meeting, the Federal Reserve slashed interest rates by a quarter point, its third consecutive rate cut since September 2024.
The bottom line
A $50,000 home equity loan comes with payments between $489 and $620 per month now for qualified borrowers. However, there is an emphasis on qualified borrowers. If you don't have a good credit score and clean credit history you won't be offered the best rates and terms.
You can deduct interest on a home equity line of credit (HELOC), but only if you use the funds for home improvements. The introduction of the Tax Cuts and Jobs Act (TCJA) eliminated deductions on interest if you use the funds for anything else, such as to consolidate debt.
Using today's average HELOC rate of 9.17%, however, here's what borrowers can expect to pay each month timed to two different repayment periods: 10-year HELOC at 9.17%: $1,020.78 monthly for a total of $42,493.73 in interest paid. 15-year HELOC at 9.17%: $819.52 monthly for a total of $867,514.23 in interest paid.
HELOCs offer greater flexibility as you can borrow and repay funds multiple times during the draw period, similar to a credit card, although interest rates may vary and availability of funds is subject to a maximum limit, while home equity loans provide a lump sum upfront, making them more suitable for specific ...
The average HELOC interest rate is currently 9.16%. If you took out a HELOC, and your interest rate remained the same for the life of the credit line (with a 15-year repayment period), you would pay $307.14 per month.
Borrow only what you need up to a set amount. No charges unless you use it. A HELOC can act as a safety net when you're not sure when you'll need the funds.
The average HELOC interest rate is currently 9.89%. And remember that HELOC interest rates are variable and these payments may change over the term of your credit line: 10-year repayment period: Your monthly payment on a $40,000 HELOC with a 10-year repayment period at today's average interest rate would be $526.17.