equity
Question: What is “equity” and how do you calculate it ?
What can you do with the amount of equity you have ?
How can I determine the amount of equity on my house ?
Answer: Equity is not the same as profit. You could have $1M in equity, sell your house for $2M and have a profit of -$3M (a loss). Equity is what your house would pay for, minus what you owe on the house. It does not exclude the cost of selling the home – that influences your basis, and possibly the equity you have in your next home. The amount you would get from the sale of your home, by that I mean profit. Estimated sale price-cost of paying off the mortgage. (Of course this excludes all the costs of selling the home but until you actually do sell it you can count it as equity) If more than 20 of the original value of the mortgage, get your mortgage insurance fee dropped. Take out a home equity loan, it is called this because you use the equity in your house as collateral for the loan. There are some restrictions but in general this loan has interest that is tax deductible. Anyone else care to elaborate on this?Get an appraiser to find out what comparable homes in your area are selling for (not the listing price in the newspaper). Then subtract how much you have left on the principal of your mortgage.
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