How Much Equity Do I Have in My Home? | Santander Bank - Santander
How Much Equity Do I Have In My Home?
What is home equity?
Home equity is the difference between what your home is worth and how much you currently owe on your mortgage. Most people must apply for a mortgage in order to purchase a home. Over time, this mortgage is paid down until the loan is completely repaid. In addition to making payments to reduce the balance owed, you can also build equity if your home’s value increases. You can find out how much equity you currently have in your home by calculating the difference between your house’s value and your current loan balance.
Determining your home value
One thing to keep in mind is that your home’s value can change over time due to the economy, changes in property values, repairs, renovations, and other factors. There are a variety of online tools to help you estimate your home’s current value based on the sales price of other comparable properties in your area. If you are applying for a home equity line of credit, Santander Bank will determine if an appraisal is necessary to process your application, and your home will be appraised at no cost to you.
How do you calculate home equity?
You can estimate your home’s equity by subtracting your remaining loan balance and your home’s appraised value.
Home’s appraised value: $250,000
Loan balance: $110,000
$250,000 – $110,000 = $140,000
Knowing your home value and loan balance can also help you calculate your loan-to-value ratio, which we’ll use to help determine if you’re eligible for a home equity line of credit and how much you qualify to borrow.