Home Equity Calculator
Find out how much equity you have in your home and how much you could borrow. Enter your home’s current value, your remaining mortgage balance, and the maximum LTV your lender allows to see your available equity for a HELOC or cash-out refinance.
Home Equity Calculator Inputs
Enter Your Home Details
Your Home Equity Results
Total Home Equity
- Current Home Equity
- $170,000 (37.8%)
- Current LTV
- 62.2%
- Available Equity (80% LTV)
- $80,000.00
- Available as HELOC
- $80,000.00
- Available as Cash-Out Refi
- $80,000.00
- Max Borrowable (80% LTV)
- $360,000.00
Equity Breakdown
| LTV Limit | Max Borrowable | Less Mortgage | Available Equity |
|---|---|---|---|
| 80% (selected) | $360,000.00 | -$280,000.00 | $80,000.00 |
| 85% | $382,500.00 | -$280,000.00 | $102,500.00 |
| 90% | $405,000.00 | -$280,000.00 | $125,000.00 |
What Is Home Equity?
Home equity is the portion of your home that you truly “own” — it’s the difference between your home’s current market value and the outstanding balance on your mortgage. As you make mortgage payments and your home appreciates in value, your equity grows. Home equity is one of the largest sources of wealth for American homeowners.
You can tap into your home equity through a HELOC (Home Equity Line of Credit), a home equity loan, or a cash-out refinance. Each option has different terms, rates, and requirements.
Understanding LTV Limits
Lenders use the Loan-to-Value (LTV) ratio to determine how much you can borrow against your home. The combined LTV (CLTV) includes all loans secured by the property. Most lenders cap CLTV at 80%, though some allow up to 85% or 90% with higher interest rates or additional requirements.
Example
Home value: $450,000 | Mortgage: $280,000 | Max LTV: 80%
- Max borrowable: $450,000 × 80% = $360,000.00
- Less existing mortgage: -$280,000.00
- Available equity: $80,000.00
HELOC vs Cash-Out Refinance
HELOC
- Revolving credit line — draw as needed
- Interest-only payments during draw period
- Variable interest rate (usually)
- Keeps your existing first mortgage
- Lower closing costs than a refinance
Cash-Out Refinance
- Replaces existing mortgage with a larger one
- Receive the difference as cash at closing
- Fixed or adjustable rate available
- One monthly payment (simpler)
- Higher closing costs, new loan terms
Frequently Asked Questions
How is home equity calculated?
Home equity equals your home’s current market value minus your outstanding mortgage balance. For example, if your home is worth $450,000 and you owe $280,000, your equity is $170,000.
What can I use home equity for?
Common uses include home renovations, debt consolidation, education expenses, emergency funds, or investment. Home improvement projects may also increase your home’s value, further building equity. Interest on home equity borrowing may be tax-deductible if used for home improvements (consult a tax advisor).
How much equity do I need to borrow?
Most lenders require at least 15-20% equity in your home (meaning your LTV is 80-85% or lower) before they will approve a HELOC or home equity loan. Some lenders will go up to 90% CLTV, but typically at higher rates.
Does a HELOC affect my first mortgage?
No, a HELOC is a separate, second lien on your home. Your existing first mortgage terms remain unchanged. However, the combined loan-to-value ratio of both loans determines how much you can borrow. If you fail to repay either loan, you risk foreclosure.
How accurate is this home equity calculator?
This calculator provides estimates based on the values you enter. Actual available equity depends on a professional appraisal, your lender’s specific LTV requirements, your credit score, debt-to-income ratio, and other underwriting criteria. Always consult a lender for an official determination of your borrowing capacity.