Published September 15, 2021
"What is Home Equity?"
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"What is Home Equity?"
In the most basic terms:
Home Equity = (Current Market Value of the Home) - (Current Mortgage Balance)
Example:
Let's say the current market value of your property is $310,000.
And let's say your mortgage balance is $280,000.
So, in this scenario you would have $30,000 of equity.*
***NOTE THE ASTERISK***
*This doesn't mean if you sold your home today you would have $30,000 straight in your pocket because, of course, there are costs associated with selling. These include real estate fees, legal fees, possible mortgage penalties, associated pre-sale improvements or repairs, buyer home inspection repairs, and moving costs.*
So before you think you have $30,000 for a down payment on your next home, make sure you chat with your realtor about the costs of selling to see what your real numbers are! (Particularly, if you haven't owned the home for a long time and only put a minimum 5% down payment on the property.)
Ready to learn about your home equity? Consults are free & no-obligation!
Nicole Darbaz, REALTOR®
Your trusted, St. John’s metro, real estate expert
Keller Williams Platinum Realty
709-691-1373
NicoleDarbaz@kw.com
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