That is a fair question to ask a calculator. The trouble is that an interest only payment is the smallest version of that debt you will ever see. If the drawing period is about to end, the payment you are used to is not the payment you will have, and a comparison built on it can mislead you.
The plain answer
Set the HELOC row to Interest-only / HELOC, enter a positive new refinance rate, and type how many years remain until it resets. If the reset is one, two, or three years out, the tool flags it under What this means and tells you the monthly savings may understate the real issue. If you leave the reset at zero, the tool assumes there is no reset and never raises the flag.
So the field is only as honest as what you type into it. Look up the date in your own HELOC paperwork and count the years.
Open the tab and find the HELOC row
Open the Debt Consolidation calculator. Under the page title you will see a short line that says what this post is about: "HELOCs can be modeled as interest-only so payment-shock risk is visible."
Each debt gets its own row. A row has a balance, an APR (%) field, Monthly Payment, Remaining Term (years), a Payment Type choice, and Balloon / Reset Due with the note "(years, if any)" beside it.
If you add your HELOC with the tool's HELOC template, it fills in some values for you, including the payment type and a reset. None of those values are yours. Replace the balance, the rate, the term, and the reset with the figures from your own statement and agreement.
Pick Interest-only / HELOC
Payment Type has three choices: Amortized by term, Use actual/min payment, and Interest-only / HELOC. For a HELOC in its interest only stage, pick the last one.
Here is what that choice does in the math. The tool takes your balance, multiplies it by your rate, and divides by twelve. That is the whole payment. No principal is in it. It matches what you probably see on your statement today, which is the point, and it is also the catch.
Type your own HELOC rate in the APR (%) field. BankPricer does not supply one and neither does this post. If your rate is variable, use the one on your latest statement.
The reset field, and why zero is the trap
Balloon / Reset Due asks for years, and it starts at zero. Zero reads to the tool as no reset at all. Nothing in the results will warn you, because as far as the tool knows, your HELOC stays interest only forever.
That is why I ask people to fill it in before they read anything else. Find the date your draw period ends, or the date a balloon or recast is due, in your HELOC agreement. Count the years from today and type that number.
The field takes whole years. If you type a part of a year, the tool drops the part after the decimal. So a reset a little past two years reads as two, and one a little short of two reads as one. A value below one year, such as 0.5, becomes zero and does not show the reset warning. If less than one year remains, enter 1 to surface the warning and use your agreement for the exact date. If you are close to another whole-year boundary, run it both ways.
What the tool says when the reset is close
When a positive new refinance rate is entered, a debt is set to Interest-only / HELOC, and Balloon / Reset Due is more than zero and no more than three, the What this means box under the results changes. It starts with that debt's label and then reads:
"has a near-term interest-only/reset risk. Monthly savings may understate the real issue: whether the borrower can handle the balloon, recast, or payoff event. Compare the new payment to the required payoff timeline before recommending a structure."
That text takes the place of the usual sentence about savings. The tool is telling you, in effect, to stop leaning on the savings number for this decision and look at the reset instead.
I like that it does this. A savings figure is easy to fall for. A sentence that names the balloon, the recast, or the payoff puts the real question back on the table.
When the tool stays quiet
The flag is narrow on purpose, and you should know where it stops.
A reset of zero, or a field left blank, never flags. A reset four years out or more does not flag either. And the flag only looks at debts set to Interest-only / HELOC, so a HELOC entered as Amortized by term or Use actual/min payment will not trip it no matter what you put in the reset field.
Quiet does not mean safe. A reset five years away is still a reset. It just falls outside the window the tool watches. If yours is out there, the payment shock is still coming, only later, and the comparison below still carries the same blind spot.
Current Combined Payments against Consolidated Payment
Now read the two payment lines side by side.
Current Combined Payments adds up the payment for every debt row. For the HELOC row set to Interest-only / HELOC, the tool counts the interest only payment. For a row set to Use actual/min payment, it uses Monthly Payment only when that amount is greater than zero. If it is zero or blank, the tool calculates an amortized payment from the balance, rate, and term instead; this mode cannot model a deferred loan with no current payment.
Consolidated Payment is the payment on one new loan for the combined balance. Under If You Consolidated, type your own rate into New Single Rate on Consolidated Loan. The help text there says to use today's market rate for the loan type, which you get from a real quote, not from this post. Then pick a Consolidated Loan Term. Until the new rate is above zero, the tool does not figure a consolidated payment at all. Once it is, the tool spreads the balance over the term you chose, principal and interest together.
If you are comparing a cash-out refinance that would replace your existing mortgage, add that mortgage as a debt row too. The calculator combines only the balances you enter; it does not automatically add your mortgage or financed closing costs.
See the mismatch. One side carries the HELOC with no principal. The other side pays principal on everything, including the HELOC balance. Monthly Savings is the gap between them, so it compares a payment that pays the loan down against one that does not.
When the reset is near, the left side is about to change on its own. The interest only payment you typed today is the low point. That is why the tool's flag says the savings may understate the real issue. The comparison is honest about this month and quiet about the month the reset hits.
Look at Lifetime Interest Difference too, with one thing in mind. For an interest only row, the tool counts lifetime interest as balance times rate times the remaining term you typed. It treats the balance as never shrinking over that term. Keep Remaining Term (years) true to your agreement so that line means something.
How I would run it
Run it once with the reset typed correctly and read What this means. Then change only the reset to zero and read it again. The gap between those two readings is the warning you would have missed.
Next, keep the reset in and try a different Consolidated Loan Term. Watch Consolidated Payment move, then hold it up against the payoff timeline your HELOC agreement sets. That is the comparison the tool's own text asks for.
Your True Blended Rate sits in the results as well. It is a useful single view of what your current debts cost together, as long as each rate you typed is your own.
What this does not tell you
The tool does not know what your HELOC turns into at the reset. It might require a balloon payment, it might recast into a payment that includes principal, or it might need to be paid off or replaced. Your agreement says which, and that answer shapes everything here.
It also cannot tell you whether consolidating is right for you. It does not see the rest of your budget, how long you plan to keep the home, or whether the new loan would be a refinance, a second loan, or something else. And it makes no call about where rates go next. Treat every figure as a reading of what you typed, nothing more.
A second pair of eyes
I work out of Chicago. If you want another read, bring your HELOC agreement with the reset date marked, the rows you typed, and what What this means said with the reset filled in. We can look at it together and talk through how the reset fits with the payment you are weighing.
A calculator result is not a commitment to lend.
Jeff Shin, NMLS 1041652. Barrett Financial Group, L.L.C. Chicago. Company NMLS 181106. Equal Housing Lender. Not a commitment to lend.