Minnesota HELOC Calculator

By SoFi Editors | Updated January 23, 2026

If you’ve been diligently paying off your home loan, you may be thinking about how to harness the equity you’ve built up in your property with a home equity line of credit (HELOC). Understanding how these loans work is the first step toward making an informed decision, and a free Minnesota HELOC calculator can quickly show you how much equity you have and what your monthly payments might be if you were to borrow against it. Take a few minutes to learn how to use this financial tool effectively.


  • Key Points
  • •  A HELOC is a revolving credit line, so borrowers can withdraw, repay, and reborrow funds repeatedly up to a predefined limit.
  • •  The maximum borrowing capacity is typically based on the homeowner’s equity.
  • •  A HELOC payment calculator estimates payments at both the draw and repayment phases of the credit line.
  • •  Interest charges are applied only to the portion of the credit limit that is currently being used.
  • •  Eligibility is determined based on an evaluation of credit history, examination of an applicant’s debt-to-income ratio, and an appraisal of the home.



This calculator is for informational purposes only. The outputs are estimates based solely on information you input. Calculations are not an offer to make a loan or an approval. All SoFi loans are subject to eligibility restrictions and limitations not reflected in this calculator, including a loan applicant’s credit, income, property. SoFi products, terms, and conditions are subject to change without notice. Learn more at SoFi.com/eligibility-criteria.

Calculator Definitions

•   HELOC Balance: The HELOC balance for the purpose of this calculator is the amount a homeowner already owes on their HELOC or the amount a prospective HELOC user is planning to borrow.

•   Current Interest Rate: The interest rate is the percentage a lender charges on the outstanding HELOC balance. HELOC rates are typically variable and fluctuate according to parameters set out in the HELOC agreement.

•   Draw Period: The HELOC’s initial phase, the draw period, often lasts 10 years. During this time, the homeowner can access funds and is often only required to pay interest on the borrowed amount.

•   Repayment Period: Once the draw period concludes, the credit line enters the repayment phase, where the ability to withdraw additional capital ends. During this stage, which may last up to 20 years, the borrower must make monthly payments that cover both a portion of the principal and interest.

•   Monthly Interest Payment: This is the amount due each month during the draw period, calculated based on the funds that have been withdrawn (not on the entire credit line). This payment does not reduce the original debt unless the borrower voluntarily contributes funds to pay down the principal.

•   Monthly Principal and Interest Payment: This combined payment becomes mandatory upon entering the repayment period. It includes both a portion of the borrowed principal and ongoing interest to ensure the total debt is repaid by the end of the term.

How to Use the Minnesota HELOC Calculator

Follow these steps to use the free HELOC calculator correctly:

Step 1: Enter Your Planned or Actual HELOC Balance

Enter the total amount of money you have already withdrawn or the maximum amount you plan to withdraw from a HELOC.

Step 2: Estimate Your Interest Rate

Type in your current interest rate if you have a HELOC, or if you are thinking about applying for a HELOC, use a rate you’ve been quoted by a lender or seen online. Remember that ultimately, HELOCs have variable rates, so you might want to run the calculator with several different interest rates to get a sense of how payments might rise or fall with rate changes.

Step 3: Choose the Length of the Draw Period

You’ll most likely have a draw period of five or 10 years. Choose the term that seems like the best fit, bearing in mind that when the draw period ends, you’ll start repaying the loan, with interest.

Step 4: Select Your Repayment Period

A longer repayment period, such as 20 years, likely means your monthly installment payments will be lower than they would with a short repayment phase. But a short repayment phase means you’ll likely pay less interest over the life of the HELOC.

Step 5: Review Your Results

Examine the projected payments the HELOC payment calculator shows for both phases, paying close attention to the jump in payment size when you enter the repayment phase. Make sure both payments fit within your budget.

What Is a Home Equity Line of Credit?

Now that you understand calculator definitions and have tried out the calculator, you probably understand a bit about what is a home equity line of credit and how it works. Take a few minutes to make sure you have a handle on all the details.

A HELOC is a second mortgage on your home, assuming you’re still paying off your first home loan. The revolving credit line uses your home equity as collateral, which is why most lenders require an appraisal of the home to qualify a homeowner for this line of credit. The fact that your home secures the HELOC means that lenders are often able to offer a larger credit line at a lower interest rate than they would for an unsecured form of borrowing, such as a home improvement loan. But it also means that you are subject to foreclosure if you don’t repay what you borrow.

To qualify for a HELOC, you’ll need at least 15% equity in your home. (Your equity is the home’s market value minus whatever you still owe on your mortgage.) Your credit score will be important, too: A score of at least 640 is needed with some lenders, and others like to see a score of 680 or better. If you qualify for a HELOC, many lenders will allow you to borrow up to 90% of your equity, and a credit limit of that amount might be set for your HELOC. This doesn’t mean you have to borrow the full amount. That’s the beauty of a line of credit: You can borrow as needed, to the extent you need to, up to your personal limit.

HELOCs are distinguished from other forms of home equity borrowing by their two phases. During the draw period, often up to 10 years, the homeowner can withdraw funds, repay a portion of the balance (or not), and re-access the credit limit as requirements change. This makes the product a good choice when you need to borrow money for projects with uncertain or variable costs, such as medical bills or a series of home improvements. Most lenders only require you to pay interest on whatever HELOC balance you are carrying during the draw phase. A HELOC interest-only calculator can show what your payments might be during this time period.

When the draw phase ends, you enter the repayment phase. Monthly payments often rise noticeably as homeowners begin to repay what they have borrowed, with interest. (A HELOC repayment calculator can show you what these payments might be.) It’s important to prepare for this jump in costs and to examine repayment costs when considering a HELOC.

Recommended: Different Types of Home Equity Loans

If it seems as if many of your friends and neighbors have advice about how to get equity out of your home, it may be because they are already borrowing based on their own healthy home equity levels. The average Minnesota homeowner is sitting on more than $135,000 in home equity, and average equity has increased more than 50% in the past five years, as home values have increased and owners have made mortgage payments. This is part of a larger national trend, as the graphic shows.

A homeowner with $135,000 in equity who is able to access a credit line worth 90% of their equity would be able to borrow $121,500.

How to Use the HELOC Calculator Data to Your Advantage

The outputs generated by the HELOC payment calculator can help you plan for the future. Beyond simply identifying a potential monthly payment, you can use the data to do the following:

Create “what-if” scenarios: Homeowners thinking about a HELOC can try putting different HELOC balances, interest rates, or repayment terms into the calculator to see how each will affect their monthly payment. This lets you see what a high or low monthly payment would be based on different interest rates. This is useful given that HELOC interest rates can shift over time.

Evaluate debt consolidation strategies: If you have balances on high-interest credit cards, you can add up the monthly payment amounts on your cards and compare that to the monthly payment you would have if you used a HELOC to pay off all that you owe at once. There’s a good chance your monthly payment with a HELOC would be lower than what you’re currently paying. It has the added benefit of simplifying your life, as you’ll have one payment instead of multiple payments.

Avoid “payment shock”: Looking carefully at the estimated payment amounts due during repayment will prepare you for how payments increase after the draw phase of a HELOC ends. Seeing these numbers early on can help a borrower limit their draws to what is really necessary.

Recommended: HELOC vs. Home Equity Loan

Tips on HELOCs

Effective management of a HELOC requires a disciplined approach, both during the application phase and once you have been approved for a line of credit. Here are some pointers:

•  Shop around for a lender: Compare offers from several lenders to pinpoint the best available interest rate from a lender whose terms suit you.

•  Manage payments carefully: Stay up to date on your monthly HELOC bills to protect your property.

•  Get real about rates: Many lenders offer low introductory rates early in the HELOC relationship. Use the calculator to estimate what will happen to your budget once that period ends and a higher rate takes effect.

•  Be disciplined about using the credit line: Some borrowers like to reserve their HELOC for renovations and home repairs. Others just want to consolidate high-interest debt. Whatever your use case, try to avoid using your HELOC like just another credit card. It’s easy to let your balance get out of hand and, unlike with a credit card, your home is on the line.

Alternatives to HELOCs

While a revolving credit line offers high levels of flexibility, it is not the only mechanism for accessing the wealth stored in a home. You’ll want to understand what is a home equity loan. And some borrowers will prefer to have a loan that doesn’t use their residence as collateral.

Home Equity Loan

Like a HELOC, a home equity loan is a second mortgage because it is secured by your home. Unlike a HELOC, the loan comes as a one-time lump sum payment. You’ll begin repaying what you owe immediately, with interest. A home equity loan typically features a fixed interest rate, so payments are predictable. This is an excellent option for individuals who know exactly how much capital is required for a single expense and prefer the stability of unchanging monthly installments. A home equity loan calculator can help you compute payments to determine what you would owe if you went this route.

Home Improvement Loan

This unsecured personal installment loan offers a lump sum of money at a fixed interest rate for a specific term. But unlike a HELOC or home equity loan, a home improvement loan does not involve using your home as collateral. Home improvement loans often have a lower borrowing limit than HELOCs, and may have higher interest rates and shorter repayment terms as well.

Personal Line of Credit

A personal line of credit is a revolving credit account, but it is usually unsecured, meaning it is not backed by your home as collateral. The primary differences from a HELOC are the level of risk and the cost. Because your home is not at risk of foreclosure, a personal line of credit is less risky for the borrower; however, this generally results in a higher interest rate and a lower credit limit compared to a HELOC.

Cash-Out Refinance

A cash-out mortgage refinance involves replacing the existing primary mortgage with a new loan for a larger amount than the current balance. The difference is provided to the homeowner in cash. This can be advantageous if a lower interest rate can be secured for the entire mortgage balance. Note that a refi leaves you with one monthly payment instead of two, an attractive feature for those trying to streamline their finances.

As you consider a cash-out refinance vs. a home equity line of credit remember that with a refinance, you can choose between a fixed or variable interest rate.

The Takeaway

A free HELOC calculator is a helpful resource for any homeowner looking to transform their dormant equity into a functional financial tool. HELOCs offer lower interest rates and are a very flexible way to borrow. A payment calculator can help homeowners understand what their repayment obligations will be during both phases of the HELOC, so they will be well prepared over the lifespan of the credit line.

SoFi now partners with Spring EQ to offer flexible HELOCs. Our HELOC options allow you to access up to 90% of your home’s value, or $500,000, at competitively lower rates. And the application process is quick and convenient.



Unlock your home’s value with a home equity line of credit from SoFi, brokered through Spring EQ.


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FAQ

Is a HELOC interest rate fixed or variable?

Most HELOCs feature a variable interest rate that fluctuates based on a benchmark index, such as the U.S. prime rate. This means monthly interest costs can shift (up or down) over time as economic conditions change. The HELOC agreement will specify how often the HELOC interest rate can rise and how high.

What happens when the draw period ends?

When the draw period concludes, typically after 10 years, you lose the ability to withdraw additional funds from the credit line. The account then enters the repayment phase, requiring regular monthly payments that cover both the principal balance and the interest. These payments are generally much higher than the interest-only payments required during the draw phase. The repayment period typically lasts between 10 and 20 years until the balance is fully settled.

What is the benefit of having a variable interest rate?

A variable interest rate can be beneficial if market rates decrease, as this lowers your monthly interest costs and the total expense of borrowing. Variable-rate products also often feature lower initial interest rates compared to fixed-rate alternatives, making them more affordable during the early stages of the draw period. However, borrowers must remain prepared for the possibility that rates could increase, which would lead to higher future monthly payment obligations.

Is the interest on a HELOC tax-deductible?

The interest paid on a HELOC may be tax-deductible. You’ll need to itemize on your tax return in order to capture this deduction. A tax advisor can help you confirm your specific eligibility.

Learn more about home equity line of credits: