Equity is not an annual figure. It changes with every payment you make and every comparable sale in your neighborhood.
Each mortgage payment retires a slice of principal. On a $300,000 loan at 6.5%, that is roughly $270 in month one and rises steadily from there.
Local prices move in quarters, not days. A 4% annual appreciation on a $450,000 home adds about $18,000 of equity in a year — far more than the principal you paid down.
The same leverage works in reverse. Value swings are the larger and less predictable half of the equation.
Twice a year is plenty for most homeowners, plus any time you are considering a renovation, a refinance, or dropping mortgage insurance.
Run your own figures through the calculator. No credit check, nothing saved unless you ask.
Calculate my equityOnly to the extent an appraiser recognizes it. Most projects return well under their full cost.
Yes. Extra principal payments go straight to equity and shorten the loan considerably.
Part of The Homeowner's Guide to Home Equity.
Home equity is your home's value minus what you owe. Here is exactly how it is calculated, with worked examples.
Find out how much equity you have in your home in about a minute, using your home value and loan balances.
LTV is the ratio lenders use to price your loan. Here is how to calculate it and what thresholds matter.