Use this free Home Equity Calculator to estimate your home's equity, equity percentage, current loan-to-value ratio (LTV), estimated equity after selling costs, and potential available equity.
Enter your home's current estimated value, remaining mortgage balance, other home-secured debt, estimated selling costs, and a maximum LTV assumption to see your results instantly.
Home Equity Calculator
Home equity is the difference between your property's current estimated value and the total debt secured by the property.
Estimated Home Equity
Enter your information and click Calculate Home Equity to see your estimated results.
What Is Home Equity?
Home equity is the portion of your property's value that remains after subtracting the total debt secured by the property.
Home Equity Formula
Home Equity = Current Home Value − Total Home-Secured Debt
For example, if your home is worth $400,000 and your total home-secured debt is $250,000, your estimated home equity is $150,000.
How to Calculate Home Equity Percentage
Your equity percentage shows the estimated percentage of your home's current value that you own after accounting for home-secured debt.
Equity Percentage Formula
Equity Percentage = (Home Equity ÷ Current Home Value) × 100
What Is Loan-to-Value Ratio?
Loan-to-value ratio, or LTV, compares your total home-secured debt with the current estimated value of your property.
LTV Formula
LTV = (Total Home-Secured Debt ÷ Current Home Value) × 100
For example, if your home is worth $400,000 and your total home-secured debt is $250,000, your estimated LTV is 62.5%.
What Is Potential Available Equity?
Your total home equity is not necessarily the same as the amount you could potentially borrow. Lenders may use maximum LTV limits and other eligibility requirements when determining how much you can borrow.
This calculator provides a simplified estimate using the maximum LTV percentage you enter.
Maximum Debt at Selected LTV
Current Home Value × Maximum LTV
Estimated Potential Available Equity
Maximum Debt at Selected LTV − Existing Home-Secured Debt
If your existing home-secured debt is already above the selected LTV limit, the calculator shows $0 as the estimated potential available equity.
What Is Negative Home Equity?
Negative equity occurs when the total debt secured by a property is greater than the property's current estimated value.
Example:
Home Value: $300,000
Home-Secured Debt: $325,000
Estimated Equity: −$25,000
In this situation, the homeowner has approximately $25,000 of negative equity before considering selling costs.
How Selling Costs Affect Home Equity
The amount of money remaining after selling a home can be lower than the property's gross equity because of transaction expenses.
Depending on the transaction, selling expenses may include commissions, fees, taxes, repairs, and other costs.
Estimated Equity After Selling Costs
Home Value − Estimated Selling Costs − Home-Secured Debt
The selling-cost percentage in this calculator is only an estimate. Actual selling expenses can vary significantly.
Home Equity Calculator Example
Suppose a homeowner has the following information:
| Item | Amount |
|---|---|
| Current Home Value | $400,000 |
| Mortgage Balance | $250,000 |
| Other Home-Secured Debt | $0 |
| Estimated Home Equity | $150,000 |
| Equity Percentage | 37.5% |
| Current LTV | 62.5% |
$400,000 − $250,000 = $150,000 estimated home equity
Potential Available Equity Example
Suppose your home is worth $400,000, your existing home-secured debt is $250,000, and you choose an 80% maximum LTV assumption.
The maximum debt at the selected LTV would be:
$400,000 × 80% = $320,000
Subtracting the existing $250,000 of home-secured debt:
$320,000 − $250,000 = $70,000 estimated potential available equity
This does not mean a lender will approve a $70,000 loan. It is only a mathematical estimate based on the selected LTV assumption.
What Can Increase or Decrease Home Equity?
Your estimated home equity can change over time because of several factors.
- Changes in your property's market value.
- Mortgage principal payments.
- Additional home-secured borrowing.
- Home improvements and renovations.
- Changes in local real estate market conditions.
- Selling costs and transaction expenses.
Does Paying Down a Mortgage Increase Home Equity?
Generally, paying down mortgage principal increases the difference between your property's value and your outstanding mortgage balance, assuming the property's value remains unchanged.
Use our Mortgage Payoff Calculator to explore mortgage payoff scenarios.
You can also use our Extra Mortgage Payment Calculator to explore the potential effect of additional mortgage payments.
Home Equity and Mortgage Refinancing
Home equity and LTV can be important considerations when exploring mortgage refinancing. Your current home value and outstanding debt can help you estimate your current LTV.
For refinancing scenarios, try our Mortgage Refinance Calculator .
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Frequently Asked Questions
What is a Home Equity Calculator?
A Home Equity Calculator estimates the difference between a home's current value and the debt secured by the property.
How do I calculate home equity?
Subtract your total home-secured debt from your home's current estimated value.
What is the home equity formula?
Home Equity = Current Home Value − Total Home-Secured Debt.
What is equity percentage?
Equity percentage is the estimated home equity divided by the current home value and multiplied by 100.
What is LTV?
LTV, or loan-to-value ratio, compares total home-secured debt with the current estimated value of the property.
What is negative home equity?
Negative equity occurs when total home-secured debt is greater than the property's current estimated value.
Can I borrow all of my home equity?
Not necessarily. Lenders may use maximum LTV limits and other eligibility requirements. Total equity does not automatically equal the amount you can borrow.
Does selling my home reduce my equity?
Selling expenses can reduce the amount remaining after a property sale. This calculator allows you to include estimated selling costs.
Does paying down my mortgage increase equity?
Generally, reducing mortgage principal increases the difference between the property's value and the outstanding mortgage balance, assuming the property value does not change.
Is this calculator financial advice?
No. This calculator provides an educational estimate based on the information entered. Actual property values, lender requirements, fees, and borrowing amounts can differ.
Home Equity Calculator: Final Thoughts
Home equity can be estimated by subtracting your total home-secured debt from your property's current estimated value. Understanding your equity and LTV can help you evaluate your overall home-financing position.
Use this calculator to estimate your current home equity, equity percentage, LTV, potential available equity, and estimated equity after selling costs.
Remember that these are estimates. Actual home values, loan balances, lender requirements, transaction costs, appraisals, and borrowing eligibility can vary.
Revisiting Tools provides general informational and educational calculator tools. Results from this Home Equity Calculator are estimates based on the information entered and should not be considered financial, investment, tax, legal, mortgage, or professional advice.
Actual property values, mortgage balances, selling costs, lender requirements, fees, appraisal results, and available borrowing amounts may differ from the calculator's estimates.
Verify important financial information with the appropriate lender, property professional, or qualified financial professional.