ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Home equity is calculated as the fair market value of the home, minus the outstanding unpaid balance owed on the property’s mortgage loan, and the total of any other liens on the property.

Detailed explanation-2: -In the simplest terms, your home’s equity is the difference between how much your home is worth and how much you owe on your mortgage.

Detailed explanation-3: -Home equity can be your greatest financial asset; your largest component of personal wealth; and your protection against life’s unexpected expenses. In “accountant-speak, ” equity is the difference between the value of an asset and the value of the liabilities against that asset.

Detailed explanation-4: -You can figure out how much equity you have in your home by subtracting the amount you owe on all loans secured by your house from its appraised value. This includes your primary mortgage as well as any home equity loans or unpaid balances on home equity lines of credit.

Detailed explanation-5: -Negative equity is when your property becomes worth less than the remaining value of your mortgage. To be in negative equity, the value of your house must fall below the amount you still owe on your mortgage. How to work out your equity. Equity is the value of your property that you own outright.