Home Equity

Your home equity is the value of your home, minus the total amount of debts (most likely mortgages) and other liens registered against title to the property.

Let’s look at an example:

• Your property is worth $400,000 
• The debt secured by your home, including the mortgage is $300,000
• This means your home equity is $100,000 ($400,000 - $300,000 = $100,000).

Your home equity will increase (yay!) if;

• the market value of your home increases
• the debt secured by the property decreases.