Indiana Home Equity Loan Calculator

By SoFi Editors | Updated December 16, 2025

For Indiana homeowners, a home equity loan can allow access to the value you’ve built up in your home. The cash can be used for significant expenses, such as home renovations and debt consolidation. A home equity loan calculator can estimate borrowing potential and monthly payments, so it’s a good idea to use this before reaching out to lenders.

Keep reading to learn how to use an Indiana home equity loan calculator, explore common uses for the funds, and review alternatives that can help you make a well-informed financial decision.

  • Key Points
  • •   A home equity loan lets homeowners borrow a lump sum of money using the equity they’ve built in their home as collateral.
  • •   An Indiana home equity loan calculator estimates potential monthly payments and determines how much you might be able to borrow.
  • •   A homeowner’s credit score and the relationship between their income and debt are factors that influence loan eligibility and the interest rates offered.
  • •   Home equity loans typically feature fixed interest rates, which means your monthly principal and interest payments will remain consistent throughout the loan’s duration.
  • •   Alternatives to home equity loans include home equity lines of credit, personal lines of credit, home improvement loans, and cash-out refinances.

Calculator Definitions

•   Home Value: Home value is the current estimated market value of your property. It is important to use the most recent, realistic valuation, not the original purchase price.

•   Desired Loan Amount: This refers to the specific lump sum of money you wish to borrow. It should align with your financial need, such as the cost of a renovation project or the total of debts you intend to consolidate.

•   Current Mortgage Balance: This is the total outstanding amount you owe on your primary home loan. It should also include the balance of any other existing loans that are secured by your home.

•   Home Equity Loan Repayment Term: This is the fixed period over which the loan is to be repaid. Repayment terms for home equity loans typically range from five to 30 years.

•   Interest Rate: This is the cost of borrowing the money, expressed as a percentage. The interest rate determines the amount of interest you will pay over the life of the loan.

•   Maximum Loan Amount: This is the highest sum a lender is likely to offer. It is calculated based on factors like your home’s value, your current mortgage balance, and your overall financial standing.

•   Estimated Monthly Payment: This is the consistent amount you will pay each month to repay the loan. This payment includes both a portion of the principal (the amount you borrowed) and the interest charged by the lender.

•   Available Equity Amount: This is the portion of your home’s value that you own outright. It is calculated by subtracting your outstanding mortgage balance from your home’s current market value.

How to Use the Indiana Home Equity Loan Calculator

An online home equity loan calculator allows you to estimate potential loan amounts and payments without needing to perform complex calculations by hand. Here’s a step-by-step guide on how to use it:

Step 1: Enter Your Home Value

Enter your home’s current estimated market value into the designated field. To arrive at a reasonable estimate, research the recent sale prices of comparable homes in your neighborhood.

Step 2: Input Your Desired Loan Amount

Enter the specific amount of money you wish to borrow. This should be the amount of money you need, not necessarily the maximum amount available.

Step 3: Type in Your Current Mortgage Balance

Provide the outstanding balance on your existing mortgage. Remember to add the balance of any other existing loans, such as a previous home equity loan, that are also secured by the property.

Step 4: Select a Home Equity Loan Repayment Term

Choose a repayment period, noting that terms typically range from five to 30 years. Longer terms can make payments easier to manage each month, but they usually cost more overall because you’ll pay more interest than you would with a shorter loan.

Step 5: Estimate Your Interest Rate

Enter an estimated interest rate to see how it affects the monthly payment. Although your rate depends on credit, income, and lender policies, using a sample rate shows how it affects total loan costs.

Step 6: Review Your Results

After you enter the required information, the calculator will display your estimated maximum loan amount and the estimated monthly payment for the loan terms you provided.

What Is a Home Equity Loan?

To make a sound financial decision, it’s important to understand what a home equity loan is. Often called a “second mortgage,” it allows homeowners to convert their equity — the portion of their home they own outright — into usable cash. Its structure, benefits, and risks set it apart from other types of borrowing.

A home equity loan is a type of secured consumer debt where homeowners borrow against the equity they have built in their property. Because the loan is secured by the home itself, it has several key characteristics:

•  Lump-sum payout: The loan provides funds in a single, upfront payment. This makes it ideal for large, one-time expenses where the total cost is known in advance.

•  Fixed interest rate: Home equity loans almost always come with a fixed interest rate. This means the rate does not change over the life of the loan, resulting in predictable and consistent monthly payments that are easy to budget for.

•  Set repayment term: The loan is repaid over a fixed period, generally between five and 30 years. The length of the term affects the size of the monthly payment.

•  Home as collateral: The home serves as collateral for the loan. This security allows lenders to offer lower interest rates compared to unsecured loans, but it also introduces the risk of foreclosure if payments are not made as agreed.

Understanding broader economic trends is important for homeowners in Indiana who are considering a home equity loan. While local real estate market conditions are always a factor, national trends also have an effect on property values and interest rates.

Over the past five years, rising home values have significantly boosted homeowner equity, which has doubled nationwide since 2020. Because of this, nearly half of homeowners with a mortgage are now considered “equity rich,” meaning they owe less than 50% of their home’s value.

In Indiana, equity levels increased a whopping 123% over the same period. The average home equity growth per homeowner is $95,652. This could be why there is so much interest around how to get equity out of your home.

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

The results from a home equity loan calculator should be viewed not as a final loan offer, but as a strategic planning tool. The estimated figures for loan amounts and monthly payments empower you to assess affordability, compare different scenarios, and approach lenders from a more informed and confident position.

Here are several ways you can leverage the data from a home equity loan calculator:

•  Assess affordability: The most important use is to analyze how the estimated monthly payment fits within your household budget. This simple check helps you determine a comfortable borrowing amount and prevents you from taking on a debt that could strain your finances.

•  Compare scenarios: You can adjust the loan term to see how shorter or longer repayment periods impact the monthly payment and the total interest paid over time.

•  Evaluate loan amounts: The calculator shows the maximum potential loan amount you might qualify for. This helps you see if your borrowing potential aligns with your financial need. Remember, you do not have to borrow the maximum amount offered.

•  Prepare for lender discussions: Armed with these estimates, you have a solid baseline for comparing actual loan offers from different lenders. You can more effectively evaluate whether a lender’s proposed rate and terms are competitive.

Home Equity Loan Scenarios

Learning how people use home equity loans helps you see how the funds can support different financial needs. Here are four ways in which you may want to use a home equity loan:

•  Home improvements: Many homeowners use the funds for renovations, remodeling projects, or major repairs. This is a popular use because it not only addresses an immediate need, but can also increase the property’s value.

•  Debt consolidation: A home equity loan can be an effective tool for paying off higher-interest debts, such as credit card balances or personal loans. By consolidating multiple debts into a single loan with a lower, fixed interest rate, you can simplify your finances with one predictable monthly payment and potentially save on interest.

•  Education expenses: The funds can be used to pay for college tuition, vocational training, or other educational costs for yourself or a family member. The favorable interest rates can make it a more affordable option than other types of education financing.

•  Major life events and purchases: The lump-sum nature of a home equity loan makes it well-suited for covering large, one-time expenses. This can include costs associated with weddings, medical bills, or other major purchases that require a substantial amount of cash upfront.

Tips on Home Equity Loans

Securing a home equity loan is a significant financial commitment that requires careful consideration. The following tips provide a framework for responsible borrowing:

•  Build a strong financial profile: Lenders look for applicants who demonstrate financial responsibility. Focus on maintaining a good credit score and managing your debt-to-income (DTI) ratio, which compares your monthly debt payments to your gross income. A strong profile will help you qualify for the most favorable rates.

•  Ensure sufficient home equity: Before they will lend against your property, lenders require that you have a meaningful ownership stake. Most lenders prefer you to retain at least 15% equity in your home after the loan is issued.

•  Shop around and compare lenders: Do not settle for the first offer you receive. Obtain quotes from multiple lenders to compare interest rates, repayment terms, and any associated fees, such as origination or appraisal fees.

•  Understand the risks: Never forget that your home is the collateral for the loan. If you fail to make your payments, the lender can initiate foreclosure proceedings. Additionally, if property values decline, you run the risk of owing more on your home (your primary mortgage plus the home equity loan) than it is worth.

•  Borrow only what is needed: It can be tempting to accept the maximum loan amount you are offered. However, it is prudent to borrow only the amount required to meet your financial need. This keeps your monthly payments and total interest costs as low as possible.

Alternatives to Home Equity Loans

While there aren’t different types of home equity loans, a home equity loan is just one of several options for accessing home equity or securing financing. Here are four alternatives to consider:

Home Equity Line of Credit (HELOC)

A home equity line of credit, or HELOC, is a revolving line of credit secured by your home equity, functioning much like a credit card. A homeowner can draw funds as needed up to a set limit. Unlike a home equity loan, a HELOC typically has a variable interest rate and is structured with a “draw period” (often 10 years) for borrowing, followed by a “repayment period” (often 20 years) for paying back the principal and interest.

A HELOC interest-only calculator can calculate what your payments might be during the initial period. To determine your principal plus interest amount during the subsequent repayment period, you can use a HELOC repayment calculator.

Recommended: What Is a Home Equity Line of Credit?

Home Improvement Loan

A home improvement loan is a type of unsecured personal loan. Because it is not secured by your home, it does not put your property at risk of foreclosure. Funds are received as a lump sum, similar to a home equity loan. However, because the loan is unsecured, the application process may be faster, but interest rates may be higher than those for a home equity loan.

Personal Line of Credit

A personal line of credit is an unsecured, revolving line of credit that is not backed by your home as collateral. Similar to a HELOC, it allows for flexible borrowing up to a set limit. However, because it is unsecured, interest rates are typically higher and borrowing limits may be lower than a HELOC.

Cash-Out Refinance

A cash-out mortgage refinance replaces your existing mortgage with a new, larger one. The difference between the new and old mortgage balances is given to you as a lump sum of cash.

When comparing a cash-out refinance vs. home equity line of credit, a cash-out refinance results in a single, new primary mortgage with its own terms and interest rate rather than a primary mortgage payment plus a separate home equity loan payment.

Understanding these options helps ensure you make the best choice for your financial future.

Recommended: HELOC vs. Home Equity Loan

The Takeaway

An Indiana home equity loan calculator is an excellent preliminary tool that helps you estimate your potential borrowing power and preview how a new loan might impact your monthly budget. By inputting your home’s value and mortgage balance, you can gain a clear sense of affordability before you begin the formal application process.

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.


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FAQ

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

A home equity loan provides a single lump sum of cash at a fixed interest rate, leading to predictable monthly payments. A HELOC is a revolving line of credit with a variable interest rate, allowing a homeowner to borrow funds as needed up to a set limit.

How much can I borrow with a home equity loan?

The amount you can borrow with a home equity loan depends on the home’s market value, the outstanding mortgage balance, and the borrower’s credit history and income. Lenders typically require homeowners to retain a certain amount of equity in their home, but borrowers may be able to access a substantial portion of the equity they have built.

What can I use home equity loan money for?

The funds are flexible and can be used for many reasons. Common uses include home renovations, debt consolidation, education expenses, medical bills, and other large, one-time purchases.

Is the interest rate on a home equity loan fixed or variable?

Home equity loans typically come with a fixed interest rate. This ensures that the monthly payments remain the same throughout the entire loan term, providing predictability for budgeting.

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

Repayment terms for home equity loans can range anywhere from five to 30 years. This flexibility allows for manageable monthly payments that can fit different budgets.

What are the qualification requirements for a home equity loan?

Qualification requirements for a home equity loan include having a sufficient amount of equity in the home, a good credit score (often 620 or higher), a steady income history, and a manageable debt-to-income ratio.

Are there closing costs or fees with home equity loans?

Yes, home equity loans often come with closing costs, which can include fees for the property appraisal, title search, and loan origination. These costs typically range from 2% to 5% of the total loan amount.

Does a home equity loan replace my first mortgage?

No, a home equity loan does not replace the first mortgage. It is a separate loan, often called a second mortgage, with its own monthly payment in addition to the primary mortgage payment.

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