What This Calculator Estimates
This calculator estimates your current home equity — the portion of your home's value you own outright — by subtracting your remaining mortgage balance from its current market value.
Formula / Method Used
Home Equity = Current Market Value − Remaining Mortgage Balance. Loan-to-Value (LTV) % = (Remaining Balance ÷ Market Value) × 100.
Worked Example
A home worth $400,000 with a $250,000 remaining mortgage balance has $150,000 in equity, an equity ratio of 37.5%, and an LTV of 62.5%.
How to Interpret the Result
Higher equity generally means more borrowing power for a home equity loan or line of credit, and more proceeds if you sell. Most lenders require at least 15-20% equity remaining after any new loan.
Common Mistakes
- Using purchase price instead of current market value.
- Forgetting to include a second mortgage or HELOC balance.
- Not accounting for selling costs when estimating actual proceeds from a sale.
- Overestimating market value without recent comparable sales.
Related Calculators
Mortgage Calculator · Refinance Calculator · Home Affordability
Frequently Asked Questions
What does this equity calculator estimate?
It estimates your current home equity by subtracting your remaining mortgage balance from your home's current market value.
What is home equity?
Home equity is the portion of your home you actually own outright, equal to its value minus what you still owe on it.
How do I estimate current market value?
Use a recent appraisal, comparable local sales, or an online estimate tool as a starting point.
What is loan-to-value ratio?
Loan-to-value (LTV) is your mortgage balance divided by your home's value, shown as a percentage — the inverse of your equity percentage.
Why does equity matter?
Equity affects your ability to refinance, get a home equity loan or line of credit, and determines your proceeds if you sell.
Last updated: July 2026