Credit Line

Credit Line Calculator Model HELOCs, personal lines, or business credit lines — including draw periods, variable rates, a...

Credit Line Calculator

Model HELOCs, personal lines, or business credit lines — including draw periods, variable rates, and payoff strategies.

Revolving

HELOC / Draw-Only

Payoff Planner

Credit Limit ($)

Current Balance ($)

Interest Rate (%)

Min Payment Rule 1% + Interest 2% of Balance $100 Min

Annual Fee ($)

Draw Period (Years)

Credit Limit ($)

Years

Rate (%)

Repayment Period (Years)

Years

Rate (%)

Monthly Payment

Current Balance ($)

Interest Rate (%)

Monthly Payment ($)

Extra Payment ($/mo)

$0

Monthly Payment

$0

Total Interest

—

Payoff Time

0%

Max Utilization

Balance & Interest Over Time

Types of Credit Lines

• HELOC (Home Equity Line of Credit)

Secured by home equity. Usually 10-year draw + 20-year repayment. Variable rate. Interest *may* be tax-deductible if used for home improvements (up to $750K mortgage debt).

• Personal Line of Credit

Unsecured, revolving. Lower limits ($5K–$50K). Higher rates (9–20%). No collateral — but harder to qualify.

• Business Line of Credit

For operating expenses. May require business collateral (equipment, AR). Rates 6–15%. Annual review/renewal common.

2025 Averages (Bankrate): HELOC: 7.5% variable; Personal LOC: 13.2% fixed; Biz LOC: 8.9% variable.

Critical Risks

• Payment Shock — HELOCs often switch from interest-only to amortizing payments — e.g., $300/mo → $800/mo overnight.
• Rate Volatility — Most lines are variable (tied to Prime Rate). A 2% rate hike adds $33/mo per $10K balance.
• Collateral Risk — Default on a HELOC = foreclosure risk.
• Draw Period End — At end of draw, you can’t borrow more — but balance remains, now with higher payments.

✅ Mitigation: Refinance before draw ends, lock fixed-rate option (if offered), or make principal payments early.

Responsible Usage Strategy

Use credit lines for:

• Short-term cash flow gaps (e.g., contractor waiting for client payment)
• High-ROI opportunities (e.g., business inventory before peak season)
• Emergency buffer — but fund it with emergency savings ASAP

Avoid:

• Using for recurring expenses (rent, groceries) — sign of income shortfall
• Maxing out (>80% utilization) — hurts credit score
• Minimum-only payments — extends debt for decades

Rule of Thumb: Keep utilization ≤30%, and aim to repay draws within 12–24 months.

How to Use This Calculator

➡️ Revolving

See min payment, interest cost, and utilization for existing lines.

➡️ HELOC

Model draw + repayment phases. The tool auto-calculates fixed repayment payment.

➡️ Payoff Planner

“If I pay $600/mo (+$100 extra), how fast will I be debt-free?” — with interest savings.

Note: Assumes no new draws during repayment. Variable rates are modeled at current rate only.