Home Equity Calculator
Calculate equity and loan-to-value.
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Result
What is a Home Equity Calculator?
A Home Equity Calculator estimates how much equity you have in your home — the difference between your home's current market value and your outstanding mortgage balance. It also calculates your loan-to-value (LTV) ratio.
How to calculate home equity manually (the formula)
The formula is: Home Equity = Current Home Value - Mortgage Balance. Your LTV ratio is: LTV = (Mortgage Balance / Home Value) × 100. A lower LTV means more equity.
Example calculation
Your home is worth $400,000 and your mortgage balance is $280,000. Home equity = $400,000 - $280,000 = $120,000. LTV = ($280,000 / $400,000) × 100 = 70%. You have 30% equity in your home.
Common mistakes
- Using the purchase price instead of current value — Home values change over time. Use a current market estimate, not what you paid.
- Forgetting about second mortgages — Include all liens against the property, not just the first mortgage.
- Assuming all equity is accessible — Lenders typically let you borrow up to 80-85% LTV, not 100% of your equity.
Frequently asked questions
How do I calculate home equity?
Subtract your outstanding mortgage balance from your home's current market value. Home Equity = Current Home Value - Mortgage Balance.
What is loan-to-value (LTV) ratio?
LTV is the ratio of your mortgage balance to your home's value, expressed as a percentage. LTV = (Mortgage Balance / Home Value) × 100.
How can I use my home equity?
You can borrow against your equity through a home equity loan or HELOC, typically up to 80-85% of your home's value minus your mortgage.
How does home equity grow over time?
Equity grows as you pay down your mortgage and as your home appreciates in value. Both factors increase your ownership stake.
Is this calculator free?
Yes, completely free with no sign-up required.