Do I have Equity in my home?

Step 1: Estimate your home’s value

Calculating equity starts with identifying the property’s market value. You can find out how much your home is worth using a number of methods. Online home price estimators are an easy (and free) way to gauge your home’s worth. These popular online tools rely on algorithms and publicly available information to generate estimates — just keep in mind that the results really are estimates, not necessarily the true amount you could sell for.

When you input your address in an online estimator, the dollar amount you’ll get is an estimate of the property’s fair market value, which might not be the same as the home’s appraised value. Mortgage and home equity lenders rely on a home’s appraised value  — based on a professional appraiser’s assessment — to determine your equity level and how much you can borrow. The fair market value of your home simply refers to what a homebuyer would likely pay for the property today.

Step 2: Find out what you owe

The next number you’ll need is the outstanding balance on your mortgage, which can be found on your most recent statement. You could also check your lender or servicer’s online dashboard, assuming it has one, or call directly for this information.

Step 3: Take the difference to determine your equity

Once you have your home’s value and your mortgage balance, calculating equity just requires basic subtraction. Your home equity equals the current value of your home minus your current mortgage debt.

Assume your home’s current value is $410,000, and you have a $220,000 balance remaining on your mortgage. Subtract the $220,000 outstanding balance from the $410,000 value. Your calculation would look like this: