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Equity Position Calculator

Home equity breaks down into two sources: appreciation and principal paydown. This calculator sizes both and shows usable equity available at 80% LTV for refinance or home equity borrowing.

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Current equity

$142,000

Combined LTV

70.72%

Appreciation gain

$83,000

market value − basis

Equity from paydown

$55,000

Typical usable equity @ 80% LTV

$45,000

How the math works

Equity combines appreciation (market value rising above basis) and principal paydown (loan balance shrinking from payments). Usable equity at 80% LTV is what lenders will let you tap via cash-out refinance or HELOC — typically 80% of market value minus current debt.

Appreciation is the larger piece for most homeowners after year 5. Principal paydown accelerates in later years as mortgages amortize. Both compound to create the bulk of typical middle-class wealth.

How to Use

  1. Enter current market value — use Zillow/Redfin for a first approximation or a recent appraisal.
  2. Enter first mortgage, second mortgage / HELOC, and other liens.
  3. Enter original purchase price and capital improvements.
  4. Read equity, LTV, and usable equity.

Frequently Asked Questions

What's usable equity?

Amount available via cash-out refi or HELOC at 80% combined LTV. = (Market Value × 80%) − current first mortgage − second. Conservative lenders limit to 75%; aggressive go to 85% with PMI.

Do I need an appraisal to know my equity?

For an actual loan, yes. For planning, automated valuation models (Zillow Zestimate, Redfin Estimate) are typically within 5-10% and good enough. Trend is more important than precision.

Can I access more than 80% LTV?

Yes, but at cost: jumbo loans up to 90%, FHA cash-out up to 80%, VA up to 100% in some cases. Each has tradeoffs in rate, mortgage insurance, and qualification. Usually 80% is the sweet spot.

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