How to Calculate a Line of Credit Payment

How to Calculate a Line of Credit Payment
A HELOC allows you to borrow money as needed against your home.

Contact your lender to determine the current interest rate and the amount you owe on your HELOC. According to the Federal Reserve Bank, most HELOCs have a variable rate, which could change from month to month.

Divide the interest rate by 1,200 to convert from an annual percentage to a monthly decimal. You would divide by 12 to convert from annual to monthly and then by 100 to convert from a percentage to a decimal, but by dividing by 1200 you simplify the process. For example, if the annual rate was 8.82 percent, you divide by 1200 to get 0.00735.

Multiply the monthly rate expressed as a decimal to calculate your minimum payment. In this example, if you borrowed $25,000, you would multiply 0.00735 by $25,000 to get $183.75 as your minimum monthly payment.