HELOC vs Cash-Out
Compare a HELOC against a cash-out refinance. See total interest, monthly payment, and how much of your equity is safely reachable.
$182,000
tappable equity
HELOC wins
Side-by-side
HELOC interest-only
$385/mo
HELOC repay payment
$458/mo
HELOC total interest
$106,154
Refi new payment
$2,066/mo
Refi total interest
$318,706
Freedom Coach™
HELOC is cheaper by $212,552 in total interest.
You have ~$182,000 of tappable equity. HELOC keeps your low-rate first mortgage intact.
Premium
Save multiple project scenarios and stress-test HELOC rate hikes.
Unlock PremiumHELOC keeps your existing (usually lower-rate) first mortgage. Cash-out replaces it with a new bigger one at today's rates. HELOC almost always wins when your first mortgage is below 5%.
Most lenders cap combined loan-to-value at 80–85%. Take your home value × 0.85, subtract your mortgage — that's your tappable equity.
Only if used to buy, build, or substantially improve the home securing the loan. Debt consolidation with HELOC funds is NOT deductible.
Variable rates. HELOCs are tied to prime — stress-test at prime + 2% before signing. The lender can also freeze your line during a downturn.
Yes, but you shouldn't. Only for appreciating uses: renovations, education, business investment. Cars and vacations should never be financed with your home.
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