Home Equity Calculator

Calculate your home equity

Current Home Value

Mortgage Balance

Your Home Equity

$170,000

37.8% of home value

Home Value

$450,000

Loan-to-Value (LTV)

62.2%

Equity Position

Equity: $170,000 of $450,00038%

LTV: 62.2% (below 80% threshold)

Borrowable Equity

Amount you can borrow through HELOC or home equity loan:

At 80% LTV (conservative)$80,000

At 85% LTV (standard)$102,500

At 90% LTV (maximum)$125,000

Frequently Asked Questions

How do I calculate my home equity?

Home Equity = Current Home Value - Mortgage Balance. Example: Home worth $400,000, mortgage balance $250,000 = $150,000 equity (37.5% of home value). Equity grows with payments and appreciation.

Formula: Home Value - Mortgage Balance = Equity
Equity grows: As you pay down principal
Equity grows: As home appreciates in value
Equity shrinks: If home value drops
LTV = Loan Balance ÷ Home Value (lower is better)

Home Value	Mortgage Balance	Home Equity	LTV
$300,000	$240,000	$60,000	80%
$400,000	$280,000	$120,000	70%
$500,000	$300,000	$200,000	60%
$600,000	$350,000	$250,000	58%

How much equity can I borrow against?

Most lenders allow borrowing up to 80-85% combined LTV (CLTV). Formula: (Home Value × 85%) - Mortgage Balance = Borrowable Equity. On $400K home with $250K mortgage: ($400K × 85%) - $250K = $90K borrowable.

CLTV = (Mortgage + New Loan) ÷ Home Value
80% CLTV: Standard, best rates
85% CLTV: Many lenders allow this
90% CLTV: Some lenders, higher rates
Leave buffer for home value fluctuation

Home Value	Current Mortgage	80% CLTV Borrowable	85% CLTV Borrowable
$300,000	$200,000	$40,000	$55,000
$400,000	$250,000	$70,000	$90,000
$500,000	$300,000	$100,000	$125,000
$600,000	$350,000	$130,000	$160,000

HELOC vs Home Equity Loan: What is the difference?

HELOC: Revolving credit line (like a credit card), draw as needed, variable rate. Home Equity Loan: Lump sum, fixed rate, fixed payment. Choose HELOC for flexibility, HE Loan for predictable large expense.

HELOC: Good for renovations, college expenses over time
HE Loan: Good for debt consolidation, one-time project
HELOC rates: Typically Prime + 0-2%
Both: Your home is collateral - can lose it if default

Feature	HELOC	Home Equity Loan
How you receive money	Draw as needed	Lump sum
Interest rate	Variable (usually)	Fixed
Monthly payment	Varies with draws	Fixed
Best for	Ongoing expenses, flexibility	Single large expense
Draw period	Usually 10 years	N/A (one-time)

Should I do a cash-out refinance or HELOC?

Cash-out refinance: Replaces your mortgage with larger one, fixed rate, one loan. HELOC: Second loan, variable rate, keeps existing mortgage. Cash-out is better if rates are lower than your current mortgage.

Cash-out: Makes sense if lowering overall rate
HELOC: Lower upfront costs, more flexible
Cash-out: Restart amortization (may extend payoff)
Consider: Will you use equity responsibly?

Factor	Cash-Out Refinance	HELOC
Number of loans	1 (replaces mortgage)	2 (adds to mortgage)
Interest rate	Fixed (mortgage rate)	Variable (Prime+)
Closing costs	2-5% of loan	0-2%
Best when	Rates lower than current mortgage	Want to keep current rate

How do I increase my home equity?

Pay down mortgage principal (extra payments), let home appreciate (market growth), make value-adding improvements (kitchen, bath), avoid cash-out borrowing. Extra mortgage payment goes 100% to equity.

Extra principal payments: Direct equity increase
Biweekly payments: 1 extra payment/year
Market appreciation: Outside your control
Strategic renovations: Kitchen, bath, curb appeal
Avoid: Home improvements that don't add value
Don't borrow against equity unless necessary

Renovation	Typical Cost	Value Added	ROI
Minor kitchen remodel	$25,000	$20,000	80%
Bathroom remodel	$12,000	$10,000	83%
New roof	$8,000	$6,500	81%
Deck addition	$15,000	$10,500	70%

What happens to my equity if home values drop?

If home value drops, equity decreases. You can become underwater (owe more than home is worth). Example: $400K home, $300K mortgage, value drops to $280K = -$20K equity (underwater). Can't sell without paying difference.

Underwater: Mortgage > Home Value
Can't sell without bringing cash to closing
HELOC: Lender may freeze your line of credit
Don't borrow max equity - leave buffer
Wait for market recovery if underwater

Example Calculations

1Home Equity on a $450,000 Home

Inputs

Home Value$450,000

Mortgage Balance$280,000

Result

Home Equity$170,000

Equity Percentage37.8%

Loan-to-Value (LTV)62.2%

Borrowable at 80% LTV$80,000

Borrowable at 85% LTV$102,500

Borrowable at 90% LTV$125,000

Equity = $450,000 − $280,000 = $170,000 (37.8% of home value). LTV = $280,000 / $450,000 = 62.2%. Borrowable at 80% CLTV = ($450,000 × 80%) − $280,000 = $360,000 − $280,000 = $80,000. At 85% CLTV = $382,500 − $280,000 = $102,500.

2Home Equity on a $600,000 Home

Inputs

Home Value$600,000

Mortgage Balance$350,000

Result

Home Equity$250,000

Equity Percentage41.7%

Loan-to-Value (LTV)58.3%

Borrowable at 80% LTV$130,000

Borrowable at 85% LTV$160,000

Borrowable at 90% LTV$190,000

Equity = $600,000 − $350,000 = $250,000 (41.7% of home value). LTV = $350,000 / $600,000 = 58.3%. Borrowable at 80% CLTV = ($600,000 × 80%) − $350,000 = $480,000 − $350,000 = $130,000. At 85% CLTV = $510,000 − $350,000 = $160,000. At 90% CLTV = $540,000 − $350,000 = $190,000.

Formulas Used

Home Equity

Equity = Home Value − Mortgage Balance

Your equity is the difference between what your home is worth and what you owe.

Where:

Home Value= Current market value of the property

Mortgage Balance= Remaining loan balance

Equity Percentage

Equity % = (Equity / Home Value) × 100

The percentage of your home that you own outright.

Where:

Equity= Home value minus mortgage balance

Home Value= Current market value

Loan-to-Value (LTV)

LTV = (Mortgage Balance / Home Value) × 100

LTV measures how much of your home is financed. Lower is better for borrowing.

Where:

Mortgage Balance= Remaining loan balance

Home Value= Current market value

Borrowable Equity

Borrowable = (Home Value × LTV Limit) − Mortgage Balance

How much equity you can access through a HELOC or home equity loan at a given LTV limit.

Where:

Home Value= Current market value

LTV Limit= Maximum combined LTV (80%, 85%, or 90%)

Mortgage Balance= Remaining loan balance

Related Resources

Related Calculators

HELOC Calculator

Credit line

Mortgage Calculator

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Last Updated: Feb 12, 2026

This calculator is provided for informational and educational purposes only. Results are estimates and should not be considered professional financial, medical, legal, or other advice. Always consult a qualified professional before making important decisions. UseCalcPro is not responsible for any actions taken based on calculator results.

UseCalcPro

Home Equity Calculator

Calculate your home equity

Current Home Value

Mortgage Balance

Your Home Equity

$170,000

37.8% of home value

Home Value

$450,000

Loan-to-Value (LTV)

62.2%

Equity Position

Equity: $170,000 of $450,00038%

LTV: 62.2% (below 80% threshold)

Borrowable Equity

Amount you can borrow through HELOC or home equity loan:

At 80% LTV (conservative)$80,000

At 85% LTV (standard)$102,500

At 90% LTV (maximum)$125,000

Frequently Asked Questions

How do I calculate my home equity?

Home Equity = Current Home Value - Mortgage Balance. Example: Home worth $400,000, mortgage balance $250,000 = $150,000 equity (37.5% of home value). Equity grows with payments and appreciation.

Formula: Home Value - Mortgage Balance = Equity
Equity grows: As you pay down principal
Equity grows: As home appreciates in value
Equity shrinks: If home value drops
LTV = Loan Balance ÷ Home Value (lower is better)

Home Value	Mortgage Balance	Home Equity	LTV
$300,000	$240,000	$60,000	80%
$400,000	$280,000	$120,000	70%
$500,000	$300,000	$200,000	60%
$600,000	$350,000	$250,000	58%

How much equity can I borrow against?

CLTV = (Mortgage + New Loan) ÷ Home Value
80% CLTV: Standard, best rates
85% CLTV: Many lenders allow this
90% CLTV: Some lenders, higher rates
Leave buffer for home value fluctuation

Home Value	Current Mortgage	80% CLTV Borrowable	85% CLTV Borrowable
$300,000	$200,000	$40,000	$55,000
$400,000	$250,000	$70,000	$90,000
$500,000	$300,000	$100,000	$125,000
$600,000	$350,000	$130,000	$160,000

HELOC vs Home Equity Loan: What is the difference?

HELOC: Good for renovations, college expenses over time
HE Loan: Good for debt consolidation, one-time project
HELOC rates: Typically Prime + 0-2%
Both: Your home is collateral - can lose it if default

Feature	HELOC	Home Equity Loan
How you receive money	Draw as needed	Lump sum
Interest rate	Variable (usually)	Fixed
Monthly payment	Varies with draws	Fixed
Best for	Ongoing expenses, flexibility	Single large expense
Draw period	Usually 10 years	N/A (one-time)

Should I do a cash-out refinance or HELOC?

Cash-out: Makes sense if lowering overall rate
HELOC: Lower upfront costs, more flexible
Cash-out: Restart amortization (may extend payoff)
Consider: Will you use equity responsibly?

Factor	Cash-Out Refinance	HELOC
Number of loans	1 (replaces mortgage)	2 (adds to mortgage)
Interest rate	Fixed (mortgage rate)	Variable (Prime+)
Closing costs	2-5% of loan	0-2%
Best when	Rates lower than current mortgage	Want to keep current rate

How do I increase my home equity?

Extra principal payments: Direct equity increase
Biweekly payments: 1 extra payment/year
Market appreciation: Outside your control
Strategic renovations: Kitchen, bath, curb appeal
Avoid: Home improvements that don't add value
Don't borrow against equity unless necessary

Renovation	Typical Cost	Value Added	ROI
Minor kitchen remodel	$25,000	$20,000	80%
Bathroom remodel	$12,000	$10,000	83%
New roof	$8,000	$6,500	81%
Deck addition	$15,000	$10,500	70%

What happens to my equity if home values drop?

Underwater: Mortgage > Home Value
Can't sell without bringing cash to closing
HELOC: Lender may freeze your line of credit
Don't borrow max equity - leave buffer
Wait for market recovery if underwater

Example Calculations

1Home Equity on a $450,000 Home

Inputs

Home Value$450,000

Mortgage Balance$280,000

Result

Home Equity$170,000

Equity Percentage37.8%

Loan-to-Value (LTV)62.2%

Borrowable at 80% LTV$80,000

Borrowable at 85% LTV$102,500

Borrowable at 90% LTV$125,000

2Home Equity on a $600,000 Home

Inputs

Home Value$600,000

Mortgage Balance$350,000

Result

Home Equity$250,000

Equity Percentage41.7%

Loan-to-Value (LTV)58.3%

Borrowable at 80% LTV$130,000

Borrowable at 85% LTV$160,000

Borrowable at 90% LTV$190,000

Formulas Used

Home Equity

Equity = Home Value − Mortgage Balance

Your equity is the difference between what your home is worth and what you owe.

Where:

Home Value= Current market value of the property

Mortgage Balance= Remaining loan balance

Equity Percentage

Equity % = (Equity / Home Value) × 100

The percentage of your home that you own outright.

Where:

Equity= Home value minus mortgage balance

Home Value= Current market value

Loan-to-Value (LTV)

LTV = (Mortgage Balance / Home Value) × 100

LTV measures how much of your home is financed. Lower is better for borrowing.

Where:

Mortgage Balance= Remaining loan balance

Home Value= Current market value

Borrowable Equity

Borrowable = (Home Value × LTV Limit) − Mortgage Balance

How much equity you can access through a HELOC or home equity loan at a given LTV limit.

Where:

Home Value= Current market value

LTV Limit= Maximum combined LTV (80%, 85%, or 90%)

Mortgage Balance= Remaining loan balance

Related Resources

Related Calculators

HELOC Calculator

Credit line

Mortgage Calculator

Payments

More Real Estate Calculators

Home tools

View All

Last Updated: Feb 12, 2026