Arkansas Home Equity Loan Calculator

By SoFi Editors | Updated December 18, 2025

Arkansas homeowners can use a home equity loan to fund major projects like renovations or debt consolidation. Our Arkansas home equity loan calculator helps you explore your borrowing power and determine how much equity you can tap into. Consult this guide to learn more about trends, alternative financing options and how to use the calculator, so you can make an informed decision.

  • Key Points
  • •   A home equity loan provides funds as a single, lump-sum payment based on the equity you have in your home.
  • •   Home equity is calculated by subtracting the mortgage balance from the home’s current market value.
  • •   The terms of your home equity loan are dependent upon a variety of factors, including your credit score and debt-to-income ratio.
  • •   Use an Arkansas home equity loan calculator to explore borrowing scenarios without making a formal commitment.
  • •   Alternatives to home equity loans exist, such as a home equity line of credit, a home improvement loan, personal line of credit, and cash-out refinance.

Calculator Definitions

•   Home Value: This is the current estimated market value of your property, not the original purchase price. This figure is the starting point for determining the amount of equity you have built in your home.

•   Desired Loan Amount: This is the total lump sum of money that you wish to borrow. This figure should be in line with the budget of your specific financial goal, whether it is a major renovation or debt consolidation.

•   Current Mortgage Balance: This is the total outstanding amount you owe on your primary home loan. For an accurate calculation, you must also include the balances of any other existing loans secured by the property, such as a prior home equity loan or HELOC.

•   Home Equity Loan Repayment Term: This is the period you’ve agreed to repay the loan. Repayment terms for home equity loans typically range from five to 30 years.

•   Interest Rate: This is the cost of borrowing money, expressed as a percentage. Home equity loans usually have a fixed rate that doesn’t change over the life of the loan.

•   Maximum Loan Amount: The maximum loan amount is the highest estimated sum a lender might offer based on your available equity and financial profile. You do not have to borrow the full amount offered.

•   Estimated Monthly Payment: This is the calculated amount, including both principal and interest, that you would pay each month. This payment remains constant until the loan is fully repaid.

•   Available Equity Amount/Percentage: This figure represents the portion of your home’s value that you own outright, and is basically the amount you can potentially borrow against. It is calculated by finding the difference between your home’s market value and your current mortgage balance.

How to Use the Arkansas Home Equity Loan Calculator

Using the Arkansas home equity loan calculator empowers you to explore a variety of borrowing scenarios so you can understand potential costs before engaging with a lender. Follow these steps to use our tool most effectively. For each of the steps, you can type in the figure or adjust the slider accordingly.

Step 1: Enter Your Home Value

Input the current estimated market value of your home. Enter a realistic figure based on recent sales of comparable properties in your neighborhood or a recent professional appraisal.

Step 2: Input Your Desired Loan Amount

Enter the amount you would like to borrow. This amount will be the principal of your loan.

Step 3: Choose Your Current Mortgage Balance

Type in the remaining principal balance on your primary mortgage. Remember to add the balance of any existing loans also secured by the property (a previous home equity loan for example).

Step 4: Select a Home Equity Loan Repayment Term

Choose the number of years for repayment (typically five to 30). Experiment with different lengths of time to see how the term directly impacts the size of your monthly payment.

Step 5: Estimate Your Interest Rate

Choose an estimated interest rate. Adjust the calculator to explore different rates to see how your monthly payment might change based on the terms you are ultimately offered.

Step 6: Review Your Results

Analyze the results—which will include an estimated monthly payment and a maximum potential loan amount—to help you determine what you can afford.

What Is a Home Equity Loan?

Before considering a home equity loan as a financing option, it is important to understand what a home equity loan is. Simply put, a home equity loan is a tool to help you finance a large amount, whether it’s toward a home renovation, consolidation of high-interest debt, or something else entirely.

When you’re in repayment, you have a fixed interest rate so your payment amount will not change, and the repayment term, typically ranging from five to 30 years, is set at the start.

Regardless of how you use the funds, the interest on a home equity loan may be tax deductible so it’s important to consult a professional tax advisor.

Finally, the loan is secured by collateral, which is the equity in your home. The downside however is that if you fail to make payments as agreed upon by the terms, the property is at risk, and the lender could initiate foreclosure.

Recommended: What Is a Home Equity Line of Credit?

As you consider how to get equity out of your home, it’s a good idea to follow housing market trends, locally and nationally. For example, from 2020 to 2025, rising home values nationwide have significantly boosted homeowner equity (see chart below). In other words, nearly half of homeowners with a mortgage owe less than 50% of their home’s value, making them “equity rich.”

In Arkansas, over the same period, equity levels have increased 118%; the average home equity per homeowner is $51,521. This is an important figure to keep an eye on as you pursue tapping into your home equity.

How to Use the Home Equity Loan Calculator Data to Your Advantage

The Arkansas home equity calculator outputs can empower you to make more informed decisions about borrowing. For instance, the calculator shows the estimated monthly payment, which can help you determine whether you can afford the loan altogether and ensure that a new loan payment won’t put your finances over the edge.

Next, the maximum loan amount represents your borrowing capacity. Getting a handle on this ceiling is especially helpful when planning for large-scale projects so you can stay within budget. Finally, the calculator is designed to run scenarios. Experiment by adjusting the variables like the loan term. You will see that a longer term will lower the payment but increase the total interest paid.

Using the Arkansas home equity loan calculator to its fullest can help you locate a balance between securing the funds you need and maintaining a repayment schedule that’s within your budget.

Home Equity Loan Scenarios

Now that you’re familiar with the Arkansas home equity loan calculator, here’s a look at two real-world scenarios:

Scenario 1: Home Renovation

A home equity loan is appropriate for a large project with a known, fixed cost like a major kitchen remodeling or outdoor deck upgrade. You would receive the full loan upfront in a lump sum. With a fixed interest rate and a 15-year repayment schedule, you can budget for the renovation with confidence, knowing the monthly payment will never change.

Scenario 2: Debt Consolidation

If you are managing several high-interest credit card balances, each with a variable rate, a home equity loan may be the right way to significantly reduce your monthly interest accrual. By consolidating multiple debts into a single loan with a lower, fixed interest rate, you would be faced with only one predictable and more manageable monthly payment, allowing you to pay off high-interest debt at once.

Tips on Home Equity Loans

Here are tips to help you navigate the home equity loan process wisely:

•  Work on your credit score. A strong credit score attracts competitive loan offers and lower interest rates. Paying bills on time and keeping credit card balances low are ways to maintain good credit.

•  Manage existing debt. Understand your debt-to-income (DTI) ratio, which compares your monthly debt payments to your income. While a DTI up to 50% may be acceptable to some lenders, having a ratio below 36% makes you a stronger applicant deserving of more favorable rates.

•  Evaluate your loan options. Shop around with a variety of lenders before making a decision. See what kind of interest rates, terms and fees are available to you.

•  Understand the risks. A home equity loan is secured debt where your home serves as the collateral. This means that if you fail to make timely payments, you risk foreclosure on your home.

Alternatives to Home Equity Loans

Because a home equity loan holds a significant risk (your home is collateral), it’s helpful to explore alternatives ways to borrow against your home equity. Here are some options:

Home Equity Line of Credit (HELOC)

A home equity line of credit, known as a HELOC, is a revolving line of credit, usually with a variable interest rate, secured by your home. You can take out money as you need it, up to the limit that was approved. Basically, HELOCs are ideal for ongoing projects with uncertain costs.

Specifically, the HELOC “draw period” (typically up to 10 years) allows you to borrow funds, and you may be required to pay only interest. The “repayment period” (usually up to 20 years) is where you repay both principal and interest. Interest is typically paid only on the amount you have borrowed. A HELOC interest-only calculator can calculate what your payments might be during the draw period, whereas a HELOC repayment calculator can help you determine your principal plus interest amount during the repayment period.

Recommended: HELOC vs. Home Equity Loan

Home Improvement Loan

A home improvement loan is a personal loan designed for upgrades or repairs. This type of loan is considered unsecured—you don’t use your home as collateral, the main difference from a home equity loan. Because it’s unsecured, this type of loan may have a higher interest rate and a shorter repayment period.

Personal Line of Credit

A personal line of credit (not to be confused with a personal loan), is a revolving credit line that can be used to pay for a variety of personal expenses. It is considered unsecured because it is not secured by your home equity. This lack of collateral results in less risk for you as the borrower, but it may lead to higher interest rates and lower credit limits compared to a HELOC.

Cash-Out Refinance

A cash-out mortgage refinance replaces your current mortgage with a new, larger one, allowing you to receive the difference between the two loan amounts in cash. It can be an attractive option if you can secure a lower interest rate than you have on your primary mortgage. Closing costs are also a factor so don’t forget these expenses when you consider the refi.

An important difference between a cash-out refinance vs. a home equity line of credit is that a cash-out refinance leaves you with just one monthly payment.

The Takeaway

Use an Arkansas home equity calculator to help you figure out affordability when you are considering tapping into your home equity. If you are pursuing a major home renovation or consolidating high-interest debt, a home equity loan may be an appropriate option. Our tool helps provide homeowners with important information to assess whether potential monthly payments fit into their budget before formally applying for a loan.

SoFi now offers home equity loans. Access up to 85%, or $750,000, of your home’s equity. Enjoy lower interest rates than most other types of loans. Cover big purchases, fund home renovations, or consolidate high-interest debt. You can complete an application in minutes.



Unlock your home’s value with a home equity loan from SoFi.


View your rate

FAQ

How is a home equity loan different from a home equity line of credit (HELOC)?

A home equity loan is a lump sum of cash that you repay with fixed monthly payments at a fixed interest rate. A HELOC, on the other hand, is a revolving line of credit with a variable interest rate so you can borrow and repay funds as needed during a specific draw period.

What can I use home equity loan money for?

The funds from a home equity loan can be used for a variety of projects and purposes. Homeowners usually put the funds toward home improvements, debt consolidation, and other major purchases or financial emergencies.

What are the typical loan terms for a home equity loan?

Borrowers generally can choose anywhere from five to 30 years for the repayment term for a home equity loan. A shorter term will have higher monthly payments but less total interest paid, while a longer term offers lower monthly payments but more interest paid over the life of the loan.

Are there closing costs or fees with home equity loans?

Yes. Home equity loans can have closing costs (ranging from 2% to 5% of the loan amount). These expenses can include fees for the appraisal, title search, and loan origination, although some lenders may offer no-closing-cost options.

Learn more about mortgages: