What Does Home Equity Mean?

When people talk about home equity, they are basically saying how much money they would have if they sold their home. This isn’t the total value of the house though – as unless you’d paid of the mortgage you wiouldn’t walk away with the full amount.


Home equity is the difference between the price for which a home could be sold (market value) and the total debts registered against it. It is the amount of financial assets you’ve accumulated in your home by the above-mentioned calculation.