Home equity
Home Equity: HELOCs, Loans and Cash-Out Refinancing
Home equity is the difference between what your home is worth and what you still owe on it. Because the debt is secured by the property, home equity borrowing prices far below credit cards or personal loans — and carries a consequence no unsecured loan does: the lender can foreclose.
These guides cover the three ways to access equity, how lenders calculate how much you can take, and when using the house to clear other debt is a good idea rather than a dangerous one.
Data snapshot
- Year over year
- -0.75 pts
- 12-month range
- 6.75% – 7.50%
The bank prime loan rate. Most HELOCs are priced as prime plus a margin, so this series is the direct driver of what a variable home equity line costs each month.
Start here
HELOC: How a Home Equity Line of Credit Works
A revolving line against your house — flexible, and variable-rate.
Read the guideHome Equity Loan vs HELOC: Which to Choose
Fixed lump sum or flexible line — pick by how you will spend it.
Read the guideCash-Out Refinance: When It Beats a Second Lien
Replace the whole mortgage — only if the new rate justifies it.
Read the guideHome equity and affordability calculator
Using Texas: property tax 1.63% of value, home insurance $4,200/yr, typical home price $300,000, cost of living index 93 (US = 100).
House price this budget supports
$252,319
- Maximum housing payment
- $2,100
- Principal + interest
- $1,342
- Loan amount
- $212,319
- Deposit applied
- $40,000
Based on the 28/36 guideline: housing under 28% of gross income and all debt under 36%. A lender may approve more than this — that is not the same as it being affordable.
Data sourced from
- Freddie Mac Primary Mortgage Market Survey
- Federal Reserve Economic Data (FRED)
- U.S. Census Bureau, American Community Survey
- Freddie Mac Primary Mortgage Market Survey
- Federal Reserve Economic Data (FRED)
- U.S. Census Bureau — ACS 5-year tables B19013_001E, B25064_001E, B25077_001E · observed 5-year estimates, 2023 vintage
This home affordability calculator builds a full housing payment: principal and interest, property tax, insurance, PMI and HOA dues.
It uses live national rate data as a starting point, then lets you adjust every assumption to match your own file.
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What people search for
Monthly US search volume for the questions this page answers, from our keyword research set.
| Search query | Monthly searches | Difficulty |
|---|---|---|
| heloc loan calculator | 60,500 | 80 |
| home equity loan calculator | 60,500 | 82 |
| rates on home equity loans | 33,100 | 78 |
| home equity line of credit calculator | 27,100 | 85 |
| loan heloc | 22,400 | 91 |
| heloc loans | 22,200 | 94 |
| how does a home equity loan work | 19,100 | 87 |
| equity loan vs heloc | 19,100 | 88 |
| what is a heloc | 14,800 | 81 |
| heloc vs home equity loan | 14,800 | 79 |