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How to Calculate Home Equity
4 Min Read | Last updated: May 20, 2026
This article contains general information and is not intended to provide information that is specific to American Express products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.
Use our home equity calculator to estimate your available equity. Learn how to calculate equity and what factors affect it.
At-A-Glance
- Your home equity refers to the current value of your home minus what you still owe on your mortgage.
- The market value of your home can fluctuate, depending on market conditions and other factors.
- You may be able to tap into your home equity, but you’ll want to carefully consider the pros and cons before doing so.
If you’re like most homeowners, you may find yourself asking the question from time to time: “How much equity do I have in my home?”
The good news is that finding out how much equity you have isn’t difficult, as long as you know your home’s value and the balance remaining on your mortgage. In this article, we’ll show you how you can quickly and easily calculate home equity.
How to Calculate Your Home Equity
Understanding how much home equity you have is a useful calculation, especially if you’re considering tapping into your home’s equity with a home equity loan or a home equity line of credit (HELOC).
Your home equity will depend on your home’s value and the amount remaining on your mortgage.1
To calculate your home equity, follow these steps.
- Find out the current market value of your home.
- Determine your total mortgage balance.
- Subtract the balance from the value.
The home equity formula is as follows:
Home Equity = Home value – Total Mortgage Balance
Let’s say your home is worth $300,000 and your total mortgage balance is $100,000. In this case, your home equity would be $200,000. ($300,000-$100,000=$200,000)
Home Equity Loan Calculator
Use Credit Intel’s home equity loan calculator to estimate the amount you may be eligible to borrow from your home.
See how much you may be eligible to borrow from your home
Enter in your estimated home value, mortgage balance, and select your credit score to find out.
This calculator is intended for illustrative purposes only and is not intended to offer any tax, legal, financial or investment advice. The terms and conditions of loans will vary by lender and may include additional fees or other terms that the calculator does not contemplate. If you have questions, please consult your own professional legal, tax and financial advisors.
Note that your actual equity will vary, depending on your specific loan and lender.
Consider Your Loan-to-Value Ratio
It’s important to keep in mind that simply having home equity doesn’t necessarily mean that you’ll be able to access all of it.1
Lenders may also consider your combined loan-to-value (LTV) ratio when deciding whether to approve your loan.2 This ratio is another way to look at how much you still owe on your home.
Here is the combined loan-to-value ratio formula:3
Combined LTV = (Total Mortgage Balance + Home Equity Loan Amount) ÷ Home Value
Many lenders have a maximum CLTV ratio of up to 85%.2 Note that our home equity calculator (above) calculates your CLTV ratio for you.
How Much Is My Home Worth?
It’s important to understand that your home value can (and almost certainly will) fluctuate according to the housing market.4
Fortunately, there are a number of free online tools you can use to get a general idea about how much your home may be worth. You may also invest in a professional appraisal, which will generally cost between $314 and $423 or more, depending on the provider.5
The appraisal will compare your home to similar properties in your area. It will consider factors like your home’s age and square footage, the construction materials used, the number of bedrooms and bathrooms, and any recent home renovations.6
Did you know?
A home equity loan, home equity lines of credit (HELOC), and cash-out refinance are all examples of products that can allow you to borrow against your home equity.7
Frequently Asked Questions
There are a few different ways that you can boost your home’s equity. You can make extra mortgage payments every month so more goes towards the principal or consider refinancing into a shorter loan term. Equity will also build if your home appreciates over time. Investing in certain home improvements and upgrades may also help to boost your home’s value.8 However, you’ll want to carefully consider whether these improvements will boost your home’s equity enough to offset the cost.
A home equity loan offers you a lump sum of money upfront. With a HELOC, you receive a revolving credit line and can withdraw money as needed, up to a set limit.9
Home equity can be used to cover a variety of expenses. These may include home renovations, investments, college expenses, and more.10 Keep in mind, however, that just because you can use home equity doesn’t necessarily mean that you should, and you’ll want to carefully consider whether it’s the right financial move for you.
The Takeaway
Knowing how to calculate your home equity can help you to make informed financial decisions, but remember that the amount that you may be eligible to borrow will vary, depending on your loan and lender. Keep in mind that lenders will consider your LTV ratio as well.
1 “Home Equity Loans and Lines of Credit,” My Credit Union
2 “What Is Combined Loan-to-Value Ratio?,” Experian
3 “What Is a Loan-to-Value Ratio (LTV)?,” Experian
4 “Assessed Value vs. Market Value: What’s the Difference?,” Experian
5 “How Much Does a Home Appraisal Cost? [2025 Data],” HomeAdvisor
6 “Consumer Guide: The Appraisal Process,” National Association of REALTORS
7 “Home Equity Loan vs. HELOC vs. Cash Out Refinance,” Experian
8 “How to Build Home Equity,” Experian
9 “What is the difference between a Home Equity Loan and a Home Equity Line of Credit (HELOC)?,” Consumer Financial Protection Bureau
10 “What Is Home Equity?,” Experian
Anna Baluch is a personal finance writer from Cleveland, OH. She enjoys helping people from all walks of life make smart financial decisions. Her work can be seen on Credit Karma, Forbes, LendingTree, Insurify, and many other publications. Connect with Anna on LinkedIn.
All Credit Intel content is written by freelance authors and commissioned and paid for by American Express.
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The material made available for you on this website, Credit Intel, is for informational purposes only and intended for U.S. residents and is not intended to provide legal, tax or financial advice. If you have questions, please consult your own professional legal, tax and financial advisors.
