Use this free home equity calculator to estimate how much of your home’s value you own after accounting for your remaining mortgage balance. Enter your home’s current estimated market value and the amount still owed on your loan to calculate your equity in dollars, equity percentage and loan-to-value (LTV) ratio.
How to Calculate Home Equity
Home equity is the difference between your home’s current market value and the outstanding balance on loans secured by the property. If your home is worth $400,000 and you owe $250,000, your estimated equity is $150,000.
The calculator also shows equity as a percentage of the home’s value and calculates LTV by dividing your remaining loan balance by the home’s value. These figures can help you understand your current position, but the result depends on the accuracy of your home value and loan balance estimates.
What Your Home Equity Percentage Means
Your equity percentage represents the share of your home’s estimated value that is not covered by the remaining loan balance. In the example above, $150,000 of equity on a $400,000 property equals 37.5% equity. The corresponding LTV is 62.5%.
Equity can increase when you pay down your mortgage or when your property value rises. It can decrease if the home’s value falls or you borrow more against it. The estimate is not a guaranteed sale price or a formal property valuation.
How Home Equity Can Be Used
Homeowners sometimes explore home equity loans, home equity lines of credit (HELOCs) or cash-out refinancing to access some of the value built up in a property. Approval and available borrowing depend on factors such as lender requirements, income, credit history, existing debts, property value and the amount owed.
Borrowing against your home creates additional debt and may put the property at risk if you cannot make the required payments. The equity shown by this calculator is not the same as the amount a lender will let you borrow.
You can use our HELOC payment calculator to estimate payments under a home equity line of credit scenario, or explore a cash-out refinance calculator to understand a different way of refinancing.
Understanding Loan-to-Value (LTV)
LTV compares your outstanding mortgage balance with your home’s current estimated value. For example, a $250,000 balance on a $400,000 home gives an LTV of 62.5%. Lenders may use LTV when assessing refinancing, additional borrowing or mortgage insurance requirements, but the applicable thresholds and rules vary by loan type and lender.
An LTV of 80% or less does not automatically mean private mortgage insurance (PMI) can be cancelled. If you are paying PMI, check your mortgage documents and contact your loan servicer to understand the eligibility requirements and process.
What This Home Equity Calculator Does Not Include
This calculator subtracts the entered loan balance from the entered home value. It does not automatically include other liens, home equity loans, selling costs, transaction fees or changes in market value. If you have multiple loans secured by the property, account for the relevant outstanding balances when assessing your overall equity.
For a more complete financial picture, compare your equity estimate with your current mortgage statement and a reliable property valuation. The result is an educational estimate, not a lender decision, appraisal or guarantee of borrowing eligibility.
Calculation Methodology & Data Transparency: This interactive tool was developed by Ratiranjan Singha using standard financial amortization algorithms. Estimated rates, limits, and guidelines are benchmarked against public data from primary institutions, including the CFPB and Freddie Mac. Results are provided for educational and estimation purposes only.
