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Home equity is the portion of your property you truly own — the difference between its current market value and the outstanding mortgage balance. It builds over time as you pay down the loan and as the property appreciates.

공식

Equity = Current market value − Outstanding mortgage balance
E
Home Equity ($)
V
Current Market Value ($)
M
Outstanding Mortgage Balance ($)

단계별 가이드

  1. 1Equity = Home Value − Mortgage Balance
  2. 2LTV (Loan-to-Value) = Mortgage ÷ Home Value × 100
  3. 3Borrowable equity is typically capped at 85% LTV
  4. 4Appreciation increases equity passively over time

풀어진 예시

입력
Home worth $400,000, mortgage $250,000
결과
$150,000 equity, 62.5% LTV — healthy position
입력
Home worth $300,000, mortgage $285,000
결과
$15,000 equity, 95% LTV — limited borrowing power

자주 묻는 질문

How do I build home equity faster?

Make extra principal payments, maintain and improve the property, and wait for appreciation. Each action directly increases your ownership stake.

Can I borrow against my home equity?

Yes, through a home equity loan or HELOC (home equity line of credit), typically up to 85% of your home's value minus the mortgage.

What is LTV and why does it matter?

LTV (Loan-to-Value) is the mortgage as a percentage of home value. Lenders prefer lower LTV because it means you have more equity and are less likely to default.

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