Louisiana Home Equity Loan Calculator

By SoFi Editors | Updated December 16, 2025

A Louisiana home equity loan calculator estimates borrowing capacity and potential monthly payments before you engage with a lender. To use the calculator, simply input your home value, current mortgage balance, desired loan amount, interest rate, and loan term. The calculator will tell you both your estimated monthly payment and your maximum loan amount.

Keep reading to learn more on home equity loans, including what a home equity loan is, a detailed guide on how to use the calculator, and alternatives to home equity loans.

Key Points
• A home equity loan uses the equity in your home as collateral for a lump-sum cash payment.
• A home equity loan calculator determines how much you might be able to borrow and estimates potential monthly payments.
• A borrower’s credit score and debt-to-income ratio are important factors for lenders when determining eligibility and loan terms.
• Home equity loans typically have fixed interest rates, which results in consistent and predictable monthly payments over the life of the loan.
• Alternatives to home equity loans include home equity lines of credit, home improvement loans, personal lines of credit, and cash-out refinances.

Calculator Definitions

• Home Value: This is the property’s current estimated market value, not the original purchase price. An accurate, up-to-date valuation helps determine the amount of equity available.

• Desired Loan Amount: This is the specific lump sum of money the homeowner wishes to borrow. It should reflect the total cost of the project or expense being financed.

• Current Mortgage Balance: This is the total amount still owed on the primary home loan and any other existing loans that are secured by the home.

• Home Equity Loan Repayment Term: This is the length of time over which the loan is to be fully 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 of the loan amount. For a home equity loan, the interest rate is typically fixed for the duration of the term.

• Maximum Loan Amount: This is the lender’s estimated borrowing limit. It’s typically calculated to ensure the homeowner’s total debt (including the primary mortgage and the new loan) does not exceed 85% of the home’s appraised value, a metric known as the combined loan-to-value (CLTV) ratio.

• Estimated Monthly Payment: This is the consistent amount paid each month to repay the loan over its term. The payment includes both principal (the amount borrowed) and interest.

• Available Equity Amount: This represents the total value a homeowner has in their property, calculated by subtracting the mortgage balance from the home’s market value. Lenders use this figure, not the desired loan amount, as the starting point for determining borrowing capacity.

How to Use the Louisiana Home Equity Loan Calculator

Using a home equity loan calculator is helpful for any homeowner considering this type of loan. It allows you to simulate various loan scenarios and assess affordability without the need for a formal application or a hard credit inquiry. Here’s exactly how to use the Louisiana home equity loan calculator:

Step 1: Enter Your Home Value

Input the current estimated market value of your home. Using a realistic and recent valuation will lead to a more accurate loan estimate.

Step 2: Input Your Desired Loan Amount

Enter the total amount of money you intend to borrow. This should be based on the specific cost of your planned expense, whether it’s a home remodel, debt consolidation, or another major purchase.

Step 3: Type in Your Current Mortgage Balance

Provide the remaining balance on your primary mortgage and any other loans secured by your property. This information allows the calculator to determine the amount of equity you have already built in your property.

Step 4: Select a Home Equity Loan Repayment Term

Select a repayment term, which typically ranges from five to 30 years. This choice will directly affect your monthly payment amount; a longer term will result in lower monthly payments but higher total interest costs over time.

Step 5: Estimate Your Interest Rate

Enter an estimated interest rate. This rate is heavily influenced by factors like your credit history and overall financial health. Experimenting with different rates can show how your monthly payment might change based on the terms you are ultimately offered.

Step 6: Review Your Results

The calculator will provide an estimated monthly payment and a potential maximum loan amount. These figures are strictly for planning purposes and do not constitute a loan offer. You can use these numbers to determine if a home equity loan is affordable for your financial situation.

What Is a Home Equity Loan?

A home equity loan is a financial product designed for homeowners who need a one-time sum of cash to cover major expenses. Often referred to as a “second mortgage,” it allows homeowners to borrow against the equity they have built in their property.

Features of a home equity loan include:

• Lump-sum disbursement: A home equity loan provides funds in a single, upfront payment.

• Secured loan: The loan is secured by your home, which serves as collateral.

• Fixed interest rate: Home equity loans come with fixed interest rates, which means your interest rate and your monthly payment will remain consistent and predictable.

• Defined repayment term: The loan is repaid over a specific period, generally between five and 30 years.

• Competitive interest rates: Because your home secures the loan, lenders typically offer lower interest rates than those for unsecured debt.

Home Equity Trends in Louisiana

As home values have risen over the last five years, so have homeowner equity levels. Overall, equity levels have doubled since 2020, a collective increase of $5.7 trillion (see chart below). About half of homeowners with a mortgage are considered “equity rich,” which means their mortgage balance is less than 50% of the home’s value.

Louisiana, unfortunately, is the only state during that same time period where equity decreased by 22%. While not much, this is still enough equity to get out of your home, assuming you meet the qualifications.

Current home equity loan rates by state.

Compare current home interest rates by state and find a home equity loan rate that suits your financial goals.

Select a state to view current rates:

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

Home equity loan calculator data allows homeowners to assess affordability, set realistic goals, and plan effectively before committing to a loan.

The estimated monthly payment helps with budgeting. By integrating this potential new payment into their existing monthly budget, a homeowner can determine if the loan is manageable without causing financial strain.

The maximum loan amount helps set realistic expectations. It clarifies the potential scale of projects that can be financed, whether for a major home improvement, a comprehensive debt consolidation plan, or another large purchase. This prevents homeowners from planning for projects that are beyond their borrowing capacity.

Finally, running multiple scenarios — by adjusting the loan amount, repayment term, and interest rate — allows for a direct comparison of how these variables impact affordability. While a longer term lowers the monthly payment, the calculator data will reveal a significantly higher total interest cost. This allows you to quantify the price of short-term affordability and make a deliberate choice about your long-term financial efficiency.

Home Equity Loan Scenarios

Here’s a look at how home equity loans can be used to address common financial situations.

Scenario 1: Home Renovations

For years, a family has dreamed of remodeling their dated kitchen, but the projected $40,000 cost was prohibitive. By securing a home equity loan, they received the full amount in a single payment, allowing them to hire a contractor immediately. Opting for a 15-year term resulted in a fixed monthly payment of approximately $380, which was easily absorbed into their budget and facilitated a project that added significant value to their home.

Scenario 2: Debt Consolidation

A homeowner has accumulated high-interest credit card debt, making it difficult to manage payments and reduce the principal. They take out a home equity loan to pay off these balances in full. This strategy replaces several unpredictable, high-rate payments with a single, fixed monthly payment at a much lower interest rate, simplifying their finances and saving thousands of dollars in interest over time.

Scenario 3: Funding Higher Education

A couple needs to cover their child’s college tuition for the upcoming academic year. They use a home equity loan to access a large, one-time sum to pay for the planned expense. This provides them with immediate funds, often at a more favorable rate than other types of education financing, allowing them to invest in their child’s future without liquidating other assets.

Tips on Home Equity Loans

To get a home equity loan, lenders want to see a strong credit profile, a low debt-to-income ratio, sufficient equity in the home, and more. Those with the best qualifications typically receive the lowest rates. Here are five ways to increase your chances of securing a home equity loan:

• Build a strong credit history: Lenders view a strong credit score as a primary indicator of financial responsibility. A higher score often translates to more attractive loan offers and lower interest rates. Consistently paying bills on time and keeping credit card balances low are key to maintaining a healthy score.

• Manage your debt-to-income ratio: Your debt-to-income (DTI) ratio compares your total monthly debt payments to your gross monthly income. Lenders prefer a lower DTI (under 50%, but preferably below 36%), as it signals a greater ability to handle new loan payments. Paying down existing debts before applying can improve your ratio.

• Maintain sufficient home equity: Lenders typically require homeowners to retain at least 15% equity in their home after the new loan is issued. This cushion protects both the lender and the borrower from market fluctuations.

• Shop around and compare offers: Interest rates and fees can vary significantly between lenders. Obtaining estimates from multiple financial institutions is essential for securing the most competitive terms and can result in substantial savings over the life of the loan.

• Understand the risks: A home equity loan is a secured debt where your home is collateral. Failure to make timely payments can put your property at risk of foreclosure.

Alternatives to Home Equity Loans

A home equity loan is just one of several ways for homeowners to access funds, and understanding the alternatives helps determine which option is best for you. Here are four to consider:

Home Equity Line of Credit (HELOC)

A home equity line of credit (HELOC) is a revolving line of credit secured by your home, functioning much like a credit card. Funds are drawn as needed during a specified “draw period,” and you typically pay interest only on the amount you’ve borrowed. The key differentiator is its usually variable interest rate, which means payments can fluctuate over time based on market conditions.

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 intended for funding renovations. Because it’s unsecured, a home improvement loan protects home equity and is often processed faster. However, this safety and speed come at a price; lenders charge higher interest rates to compensate for the increased risk, making it a potentially more expensive option for large-scale projects.

Personal Line of Credit

A personal line of credit is an unsecured, revolving line of credit from a financial institution. Unlike a HELOC, it is not secured by home equity. This lack of collateral typically results in lower credit limits and higher interest rates compared to a HELOC, as the lender assumes more risk.

Cash-Out Refinance

A cash-out mortgage refinance involves replacing your current mortgage with a new, larger one, allowing you to receive the difference in cash.

When comparing a cash-out refinance vs. home equity line of credit, a cash-out refinance results in a single, new primary mortgage rather than a separate second mortgage. This can be an opportunity to secure a new interest rate on your entire mortgage balance.

Ultimately, the choice depends on a careful assessment of your financial situation and long-term goals.

Recommended: HELOC vs. Home Equity Loan

The Takeaway

A home equity loan can be ideal for accessing a large, one-time sum of cash to fund significant expenses, such as home improvements, debt consolidation, or education. Its primary advantages are a fixed interest rate and a predictable monthly payment schedule, which offer stability and make budgeting straightforward.

The Louisiana home equity loan calculator helps homeowners estimate their monthly payments and maximum borrowing power before meeting with a lender.

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 with a fixed interest rate and consistent monthly payments. In contrast, a HELOC is a revolving line of credit with a typically variable interest rate, where you borrow funds as needed up to a set limit, and your payments can fluctuate based on the amount borrowed and changes in the interest rate.

How much can I borrow with a home equity loan?

The amount depends on your home’s equity, credit score, and income. Lenders typically allow your total mortgage debt — including your primary mortgage and the new loan — to reach up to 85% of your home’s appraised value. This means you must retain at least 15% equity after the loan is issued.

What can I use home equity loan money for?

Home equity loan funds are flexible and can be used for a wide range of purposes. Common uses include home renovations, consolidating high-interest debt, funding education expenses, paying for medical emergencies, and financing other large purchases or life events.

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

Home equity loans typically come with a fixed interest rate. This means the rate does not change over the life of the loan, which results in predictable and stable monthly payments that are easy to budget for.

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

Repayment terms for home equity loans are generally lengthy, typically ranging from five to 30 years. This flexibility allows borrowers to choose a term that helps keep their monthly payments at a manageable level.

What are the qualification requirements for a home equity loan?

Requirements for a home equity loan include having sufficient equity in your home, a good credit score (lenders often prefer scores of 620 or higher), verifiable income to demonstrate repayment ability, and a favorable debt-to-income ratio. While lender requirements vary, a DTI of 50% or lower is often preferred.

Are there closing costs or fees with home equity loans?

Yes, home equity loans can have closing costs, which typically range from 2% to 5% of the loan amount. These may include fees for a home appraisal, title search, and loan origination. Some lenders may offer no-closing-cost options, but these often come with a higher interest rate.

Does a home equity loan replace my first mortgage?

No, a home equity loan does not replace your first mortgage. It is a second mortgage, meaning it is a separate loan with its own separate payment. Your existing primary mortgage remains in place, and you will be responsible for making payments on both loans simultaneously.