Home Equity Calculator

This home equity calculator shows how much of your home you own outright and how much you might be able to borrow against it. Enter your home’s value, what you owe and the lender’s limit. You get your equity in dollars and percent, your loan-to-value ratios, and an estimate of your borrowing room.

How to use this calculator

You need only four numbers, and most come from your mortgage statement.

• Home value. This is the number that moves your result most. Use a cautious figure, because the lender will order its own valuation.
• First mortgage balance. Use today’s payoff balance, not the original loan amount.
• Other loans on the home. Include any HELOC, home equity loan or other lien. Leave it at 0 if there are none.
• Lender’s maximum combined LTV. Start at 80%, a common cap for cash-out refinances. Try 85% or 90% to see what a more generous HELOC limit would mean.

How it is calculated

The math is simple subtraction and division.

1. Equity = home value − first mortgage − other loans
2. Equity share = equity ÷ home value
3. Loan-to-value (LTV) = first mortgage ÷ home value
4. Combined loan-to-value (CLTV) = (first mortgage + other loans) ÷ home value
5. Borrowing room = home value × maximum CLTV − first mortgage − other loans (never less than $0)

The borrowing room is a ceiling, not an approval. It does not check your credit score, income or debt-to-income ratio, and it does not subtract closing costs.

Worked example

The table keeps the same home and changes one input at a time.

Notice the last row. A $50,000 lower appraisal cuts borrowing room by $40,000, because the limit is a share of the value.

What your result means

Your equity is your stake in the home. Your borrowing room is the most a lender might allow, before it looks at your credit and income. Borrowing less than the maximum leaves a cushion if home values fall.

Rules that change the answer:

• Cash-out refinance limits. For a one-unit main home, Freddie Mac caps cash-out refinances at 80% of value, with lower caps for second homes and investment properties. HUD Mortgagee Letter 2019-11 caps FHA cash-out refinances at 80%.
• HELOC limits. The CFPB HELOC booklet says you can generally borrow a percentage of the appraised value minus what you owe. Each lender sets its own percentage.
• Changes in value. The CFPB notes a lender may reduce or freeze a HELOC if your home’s value drops significantly.
• PMI uses original value. For removing private mortgage insurance, the CFPB explains that the 80% and 78% thresholds are measured against your home’s original value, usually the lower of the price or the appraisal at purchase. A higher value today doesn’t automatically count.

Common mistakes

• Using the original loan amount instead of today’s balance.
• Forgetting a HELOC or home equity loan you already have.
• Treating borrowing room as cash in hand. Closing costs and lender rules reduce what you actually get.
• Assuming today’s value counts for PMI removal without checking your servicer’s rules.
• Borrowing the maximum and leaving no equity cushion.

Related guides and tools

Read cash-out refinance vs HELOC to choose how to borrow, when you can remove PMI to see how equity ends mortgage insurance, and when to refinance your mortgage if you are weighing a new loan.

Then compare payments with the cash-out refinance vs HELOC calculator, find your PMI dates with the PMI removal calculator, or test a rate-and-term refinance with the refinance break-even calculator.