Free Home Equity Calculator: Estimate Your Borrowing Power
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This home equity calculator can help you estimate both your current home equity and how much of it may be available to borrow based on common loan-to-value (LTV) limits.
Simply enter your home’s estimated value along with your current mortgage balance (and any second mortgage, if applicable) to see your estimated equity in seconds.
Unlock Your Equity and Buy Before You Sell
Through our Buy Before You Sell program, HomeLight can help you unlock a portion of your equity upfront to put toward your next home. You can then make a strong offer on your next home with no home sale contingency.
How a Home Equity Calculator Can Help You
Whether you’re just curious or you’re considering an equity-based loan, this handy calculator provides a quick starting point for understanding one of your most valuable financial assets.
A home equity calculator makes it easy to estimate how much of your home you truly own. Instead of manually calculating your equity, the tool instantly shows:
- Estimated home equity: The difference between your home’s current appraised value and the remaining balance on your mortgage(s).
- Estimated borrowing power: Approximate amounts you may be able to borrow at several common loan-to-value (LTV) thresholds.
- Side-by-side comparisons: A chart and table that illustrate how available equity changes at different LTV percentages.
To learn more, see our post: Options to Unlock Your Home Equity.
Editor’s note: While the calculator provides helpful estimates, your lender will determine the amount you may qualify to borrow based on factors such as your credit profile, income, debt, and a professional appraisal.
How Is Home Equity Calculated?
Home equity is simply the difference between your home’s current market value and the amount you still owe on your mortgage.
Home Equity = Current Home Value − Total Mortgage Balance
For example, if your home is worth $500,000 and you owe $325,000, your estimated home equity is $175,000.
If you have a second mortgage or home equity loan, that balance should also be included since it reduces your available equity.
If you’re curious what your home is currently worth, try HomeLight’s Home Value Estimator. Answer a few questions about your home to receive a ballpark estimate.
What Does Loan-to-Value (LTV) Mean?
After calculating your estimated equity, the tool also shows how much of that equity may be available at several common loan-to-value ratios, including 80%, 85%, 90%, and 95%.
Loan-to-value (LTV) compares the total amount borrowed against your home’s appraised value. Most lenders won’t allow homeowners to borrow 100% of their equity. Instead, many set maximum borrowing limits based on a percentage of the home’s value, while some loan programs may allow higher limits.
These LTV estimates help illustrate how borrowing limits can affect the amount of equity you may be able to access.
Example: If your home is worth $500,000 and a lender allows borrowing up to 80% LTV, the maximum combined loan balance would generally be $400,000. If you currently owe $300,000, you may be able to borrow up to $100,000, assuming you meet the lender’s qualifications.
While the industry standard for home equity loans and HELOCs is a combined loan-to-value (CLTV) ratio of 80% to 85%, some lenders offer high-LTV products with CLTVs of 90% to 100%.
To learn more, see our post: How Much Equity Can I Borrow From My Home?
Home Equity Is More Than a Number
Knowing how much equity you’ve built is an important first step when evaluating your financial options. Our Home Equity Calculator makes it easy to estimate your current equity and understand how loan-to-value limits may affect the amount you could potentially borrow.
For a more complete picture of your finances, explore other free HomeLight tools, including our:
- Mortgage Payment Calculator
- Down Payment Calculator
- Buyer Closing Costs Calculator
- Seller Closing Costs Calculator
- Earnest Money Calculator
- Home Affordability Calculator
- Home Downsizing Calculator
- Bridge Loan Snapshot Tool
- Homes For Sale Search Tool
- Recently Sold Homes Map
If you’re considering borrowing against your home, a qualified lender can help you review your options and provide personalized loan estimates.
If you’re looking to buy or sell, HomeLight’s free Agent Match platform can connect you with a trusted, top-rated real estate agent in your area. We analyze over 27 million transactions and thousands of reviews to determine which agent is best for you based on your needs.
If you’re buying and selling a home at the same time, check out HomeLight’s Buy Before You Sell program. This modern bridge solution unlocks your current equity and streamlines the process. You can make a stronger, non-contingent offer on your new home and move only once. Watch this short video to learn more.