Home Equity Calculator
See how much equity you have and what you could borrow with a HELOC or home equity loan.
Disclaimer: This calculator is for general educational and informational purposes only. It does not constitute financial advice, investment advice, tax advice, or legal advice and is not a substitute for consultation with a qualified professional. No fiduciary or advisory relationship is created by your use of this tool. Results are estimates based on the inputs you provide, standard mathematical formulas, and publicly available data that may not be current and may not reflect your individual financial situation, applicable tax laws, or other relevant factors. Neither MayoCalc nor Cook Media Systems assumes any liability for losses, damages, or other consequences arising from the use of any information or results provided by this tool. Always consult a qualified financial advisor, certified public accountant, or attorney before making financial decisions. See our full
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What Is Home Equity?
Home equity is the difference between your home's current market value and the amount you owe on your mortgage. If your home is worth $400,000 and you owe $280,000, your equity is $120,000. Home equity builds in two ways: as you make mortgage payments that reduce the principal balance, and as your home appreciates in value. For most American households, home equity is the single largest component of net worth.
How to Use This Calculator
Enter your home's estimated current value and your remaining mortgage balance. The calculator shows your total equity in dollars, your equity as a percentage of the home's value (loan-to-value ratio), and whether you have reached the 20% equity threshold for removing private mortgage insurance (PMI). You can also model future equity based on expected appreciation rates and additional principal payments.
Why Home Equity Matters
PMI removal: Once you reach 20% equity (80% LTV), you can request removal of PMI, which typically costs 0.5-1% of the loan amount per year. On a $350,000 mortgage, that is $1,750-$3,500 annually. HELOC eligibility: Most lenders allow you to borrow against your equity via a home equity line of credit once you have at least 15-20% equity. Refinancing: More equity means better refinancing terms and lower rates. The Refinance Calculator shows potential savings.
Home Equity FAQ
How do I estimate my home's current value?
Check online estimates from Zillow, Redfin, or Realtor.com for a rough starting point. For a more accurate figure, look at recent comparable sales in your neighborhood (same size, condition, and location sold within the last 3-6 months). For the most precise value, hire a licensed appraiser ($400-700).
Can home equity decrease?
Yes. If your home's market value drops below your mortgage balance, you have negative equity (also called being "underwater"). This happened to millions of homeowners during the 2008-2009 housing crisis. Negative equity makes it difficult to sell or refinance. Maintaining a significant down payment and avoiding overextending on purchase price reduces this risk.