How much would a $50,000 home equity loan cost per month? (2024)

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MoneyWatch: Managing Your Money
How much would a $50,000 home equity loan cost per month? (2)

The last 18 months have been tough on prospective homebuyers. Not only have for-sale home inventory levels stayed low, but home prices have continued to increase due, in large part, to steady demand. And, thanks to 11 recent Fed rate hikes, the average rate on a 30-year fixed mortgage loan is now above 7.5% — over double what borrowers were being offered in 2020 and 2021.

In other words, it costs a lot more to buy a home right now than it did two years ago.

But there is one bright spot that has emerged from the unusual housing market environment. Due to the increase in home prices, the average homeowner now has about $200,000 in tappable home equity, which can be used for a range of purposes, like home improvements, debt consolidation or unexpected expenses.

If you're considering a home equity loan, though, it's crucial to understand how much it will cost you each month so you can determine if it fits into your finances. Below, we'll break down what you can expect to pay on a monthly basis for a $50,000 home equity loan based on today's average rates.

Explore the home equity loan rates you could qualify for here.

How much would a $50,000 home equity loan cost per month?

You have a few different options when it comes to home equity loans, including 10- and 15-year loan terms. So, for these examples, we'll explore the monthly costs associated with three different loan options: a 10-year fixed home equity loan, a 15-year fixed home equity loan and a 10-year home equity line of credit (HELOC).

The formula for calculating the monthly cost of a home equity loan stays the same across the board. You can use this formula to calculate the approximate monthly costs of nearly any home equity loan type and amount:

Formula: Monthly payment = P * [r(1 + r)^n] / [(1 + r)^n – 1]

  • P = Principal amount ($50,000)
  • r = Monthly interest rate (Annual rate / 12 months / 100)
  • n = Number of monthly payments (Loan term in years * 12)

Find out today's top home equity loan rates here.

Example 1: 10-Year fixed home equity loan at 8.75%

A 10-year fixed home equity loan offers a fixed interest rate. This means your monthly payments will remain the same throughout the life of the loan unless you refinance to a lower rate.

Calculating the monthly cost for a $50,000 loan at an interest rate of 8.75%, which is the average rate for a 10-year fixed home equity loan as of September 25, 2023, the monthly payment would be $626.63.

And because the rate is fixed, this monthly payment would stay the same throughout the life of the loan.

Example 2: 15-year fixed home equity loan at 8.73%

Now, let's consider a 15-year fixed home equity loan with an interest rate of 8.73%, which is the current average rate for this type of home equity loan. Using the same formula as above, we can calculate the monthly payment. Your monthly payment would be approximately $499.13. And, as with the 10-year home equity loan, this monthly payment would stay the same throughout the life of the loan.

Example 3: 10-Year HELOC at 9.10%

A HELOC is a type of home equity loan that functions like a line of credit rather than a lump-sum loan. This type of home equity loan typically comes with a variable interest rate, but for this example, we'll assume that the rate does not change over the life of the HELOC and that you used the full $50,000 credit line.

Let's calculate the monthly cost for the 10-year HELOC at an interest rate of 9.10% — which is the current average rate. Just keep in mind that the interest rate can fluctuate during the loan term, which may affect your monthly payments.

With a 10-year HELOC at 9.10%, your initial monthly payment would be approximately $636.09. However, keep in mind that this rate can change over time based on market conditions, which would directly impact the amount of your monthly payments.

The bottom line

Before taking out a $50,000 home equity loan or HELOC, it's essential to understand the monthly costs associated with each option. Fixed-rate home equity loans provide predictable payments, while HELOCs offer flexibility but come with variable interest rates that may change. Before making a decision, it can help to consider your financial goals, risk tolerance and budget to find the right loan — and term — with a monthly payment that fits your budget and needs.

Angelica Leicht

Angelica Leicht is senior editor for CBS' Moneywatch: Managing Your Money, where she writes and edits articles on a range of personal finance topics. Angelica previously held editing roles at The Simple Dollar, Interest, HousingWire and other financial publications.

How much would a $50,000 home equity loan cost per month? (2024)

FAQs

How much would a $50,000 home equity loan cost per month? ›

Calculating the monthly cost for a $50,000 loan at an interest rate of 8.75%, which is the average rate for a 10-year fixed home equity loan as of September 25, 2023, the monthly payment would be $626.63.

What is the monthly payment on an $50,000 home equity loan? ›

Loan payment example: on a $50,000 loan for 120 months at 7.65% interest rate, monthly payments would be $597.43. Payment example does not include amounts for taxes and insurance premiums.

What is the monthly payment for a $50,000 loan? ›

Monthly payments for a $50,000 personal loan
Loan durationAverage monthly payments ($50,000 loan)
Poor creditExcellent credit
1–12 months$4,218.00$4,306.43
13–24 months$2,310.59$2,259.89
25–36 months$1,880.71$1,559.68
1 more row
Mar 7, 2024

What is the monthly payment on a $75000 home equity loan? ›

As of November 10, 2023, the average rate on a 10-year fixed-rate home equity loan is 9.09%. If you have a $75,000 home equity loan with these terms, you'd pay $39,447.03 in interest over the course of the loan. The monthly payment on this loan would be $952.73.

How is a $50,000 home equity loan different from a $50,000 home equity line of credit? ›

While a HELOC works like a credit card — giving you a maximum amount you can borrow with a variable interest rate — a home equity loan works more like your mortgage. You get a lump sum of money, and you repay it on a set schedule with a fixed interest rate.

Can you get a mortgage loan for $50,000? ›

Minimum mortgage amount you can borrow

Mortgage lenders have different minimum mortgage amounts. You'll probably have an easier time finding a small mortgage if you want to borrow at least $50,000.

What is the payment on a 100 000 home equity loan? ›

The average interest rate for a 10-year fixed-rate home equity loan is currently 9.09%. If you borrowed $100,000 with that rate and term, you'd pay a total of $52,596.04 in interest. Your monthly payment would be $1,271.63.

How much is a $50,000 mortgage a month? ›

Term length
Mortgage AmountTerm LengthMonthly Repayments
£50k20 years£316
£50k25 years£278
£50k30 years£253
£50k35 years£237
3 more rows
Feb 12, 2024

What credit score do I need for a $50,000 loan? ›

Most lenders prefer borrowers with a credit score in the good to excellent range (670 or higher), indicating a history of responsible financial management.

Is it hard to get approved for a 50000 loan? ›

For a $50,000 personal loan, lenders will likely want to see a strong credit score and history. Requirements vary from lender to lender, but a relatively high credit score may be a prerequisite to qualify for a sizable loan.

Is it hard to get a home equity loan? ›

Home equity loans are relatively easy to get as long as you meet some basic lending requirements. Those requirements usually include: 80% or lower loan-to-value (LTV) ratio: Your LTV compares your loan amount to the value of your home. For example, if you have a $160,000 loan on a $200,000 home, your LTV is 80%.

What is the payment on a $25,000 home equity loan? ›

For this example, we'll calculate the monthly cost for a $25,000 loan using an interest rate of 8.75%, which is the current average rate for a 10-year fixed home equity loan. Using the formula above, the monthly payment for this loan would be $313.32 (assuming there are no extra fees to calculate in).

What is a good home equity loan rate? ›

Home equity loans have fixed interest rates, which means the rate you receive will be the rate you pay for the entirety of the loan term. As of April 24, 2024, the current average home equity loan interest rate is 8.63 percent. The current average HELOC interest rate is 9.10 percent.

What is a monthly payment on a $50,000 loan? ›

Here's what a $50,000 loan would cost you each month
8.00%
Two-Year Repayment$2,261.36/month, $4,272.75 in interest over time
Seven-Year Repayment$779.31/month, $15,462.10 in interest over time
10-Year Repayment$606.64/month, $22,796.56 in interest over time
Jan 20, 2024

What is the payment on a $50,000 equity loan? ›

Calculating the monthly cost for a $50,000 loan at an interest rate of 8.75%, which is the average rate for a 10-year fixed home equity loan as of September 25, 2023, the monthly payment would be $626.63.

What is cheaper home equity loan or line of credit? ›

Home equity financing is a low-cost option because there are no closing costs for installment loans or lines of credit. Rates for an installment loan may be marginally higher than for a credit line but the term also is usually longer, so your monthly payments may be similar for both.

How much is the monthly payment on a $25 000 HELOC? ›

Here are the monthly payments you can expect on HELOCs with 20-year terms (as calculated with the Mortgage Calculator): $25,000 HELOC with a 20-year term: $25,000 HELOC balance at 9.8%: $204.17 per month. $25,000 HELOC balance at 10.3%: $214.58 per month.

How is a $50000 home equity loan different from a $50000 home equity line of credit quizlet? ›

How is a $50,000 home equity loan different from a $50,000 home equity line of credit? The person who takes the loan receives the full $50,000 at once; the person with the line of credit can borrow against the credit line for any amount up to $50,000 as money is needed.

What is typical payment terms for a home equity loan? ›

A home equity loan term can range anywhere from 5-30 years. HELOCs generally allow up to 10 years to withdraw funds, and up to 20 years to repay. A cash out refinance term can be up to 30 years.

What is the current interest rate on home equity loans? ›

What are today's average interest rates for home equity loans?
LOAN TYPEAVERAGE RATEAVERAGE RATE RANGE
Home equity loan8.67%8.50% – 9.49%
10-year fixed home equity loan8.80%7.77% – 9.52%
15-year fixed home equity loan8.80%8.07% – 10.23%

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