HELOC sizing is one line of arithmetic: home value × the lender's combined-loan-to-value cap, minus everything already owed against the house. Most programs cap CLTV at 80–85% on a primary residence (a few reach 90%); investment properties cap lower, around 70–75%. The payment shown is interest-only on the drawn amount — the standard structure during the draw period.
Reading your result
The appraisal method matters: fast fintech HELOCs use automated valuations (AVMs) that run conservative — a full appraisal is slower but can unlock a meaningfully bigger line on the same house. And the interest-only figure is the honeymoon number: when the draw period ends, the payment steps up to amortize the balance, so borrow against the repayment-phase payment, not the IO one.
The real decision is usually HELOC versus cash-out refinance — if your first mortgage carries a low legacy rate, the second lien almost always wins the blended math. Run the logic in HELOC vs cash-out, or the rental HELOC guide if the property is an investment.
Frequently asked questions
How much can I borrow on a HELOC?
Home value times the lender's CLTV cap (typically 80–85% on a primary residence), minus your current mortgage balance. Investment properties cap lower, around 70–75%.
Does a HELOC change my existing mortgage?
No. A HELOC is a second lien — your first mortgage, its rate, and its payment are untouched. That is the core reason it often beats a cash-out refinance for borrowers holding a low rate.
Is the payment really interest-only?
During the draw period, usually yes — on what you have drawn, not the whole line. When the draw period ends the balance amortizes and the payment steps up meaningfully. Plan around the repayment-phase number.
AVM or full appraisal for my HELOC?
AVMs make 5–7 day closings possible but value conservatively. If your max line matters more than speed, a full appraisal frequently supports a higher value and a bigger line.