Home Equity Calculator
Calculate your current home equity and borrowing potential.
What is home equity?
Home equity is the portion of your home you actually own outright — the difference between your home's current market value and what you still owe on your mortgage. As you pay down your loan and your home's value appreciates, your equity typically grows over time.
How lenders use your equity
Most lenders allow homeowners to borrow up to around 80% of their home's value (combining their existing mortgage and any new loan) through a home equity line of credit (HELOC) or home equity loan. This calculator estimates that borrowing potential based on the common 80% combined loan-to-value guideline.
This is an estimate — actual lending limits vary by lender, your credit profile, and current market conditions. Contact a lender for an exact pre-qualification figure.
Frequently Asked Questions
How is home equity calculated?
Home equity equals your home's current market value minus your remaining mortgage balance. If your home is worth $400,000 and you owe $250,000, you have $150,000 in equity.
How much can I borrow against my home equity?
Most lenders allow you to borrow up to about 80% of your home's value combined with your existing mortgage, though this varies by lender and your credit profile.
What's the difference between a home equity loan and a HELOC?
A home equity loan gives you a lump sum with a fixed rate, while a HELOC works more like a credit card — a revolving credit line you can draw from as needed, typically with a variable rate.
Does home equity count toward my net worth?
Yes, home equity is typically one of the largest components of net worth for homeowners, since it represents real ownership value in an asset.
What is loan-to-value ratio?
Loan-to-value (LTV) ratio is your mortgage balance divided by your home's value, expressed as a percentage. A lower LTV generally means more equity and better loan terms.
Can I have negative home equity?
Yes — this happens when you owe more on your mortgage than your home is currently worth, often called being "underwater," typically due to a market downturn or a low initial down payment.
How accurate is this home equity estimate?
It's only as accurate as the home value and mortgage balance you enter. Get a professional appraisal or a comparative market analysis for a precise home value figure.