There are a lot of mortgage terms that we have heard a lot, but we don’t always 100% know what they mean. Today we’ll explain what home equity really is and how you could use it.
To put it simply home equity is the amount of your house that you own. So for example if you have a mortgage loan balance of $100,000 and your home’s value is $300,000 then you have $200,000 in home equity. You calculate home equity by subtracting your mortgage balance from the appraised value of the home.
Your home equity is an asset and you can use it for things like cash-out refinancing, home equity lines of credit (HELOC) perhaps if you have paid your mortgage off you can also get a reverse mortgage.
If your home value has increased in recent years and are looking to use your equity, use our 60 second analysis on our website to see your options.
