How Much Equity Do I Have?

“Equity” sounds like banker talk. It’s simply how much of your home is yours after you subtract what you still owe.

Two numbers — that’s it

What could your home sell for today? What’s left on the mortgage? The gap is your equity. The example below walks through it — use today’s value, not what you paid at closing.

Filling in those two numbers

For what you owe, start with your monthly mortgage bill. Add a home equity line or second loan if you have one. For what it’s worth, online estimates and recent sales on your street are enough — until you’re actually selling or borrowing.

Why banks talk in percentages

Lenders compare what you owe to what the home is worth. Owing $430,000 on an $820,000 home means you still owe 52% of the value — they call that loan-to-value (LTV). Under about 80%, many people can drop mortgage insurance or refinance more easily. Above 90%, there’s often little room to borrow until you pay down the loan or the home goes up in value.

Why the number moves

• Your monthly payment slowly chips away at what you owe
• Home prices on your street go up or down
• Pulling cash out with a new loan or line of credit lowers your equity

Check again when something real comes up — a renovation, a refi offer, a neighbor’s sale. Otherwise once a year is plenty.