People put a lot of work into their homes and deserve to be rewarded for it when the time comes. One way for a person to reap the benefits of improving their homes is by finding out their home equity, which comes in handy when applying for a loan.
Have your home appraised. The appraised value of your home will show you exactly what your home is worth at this particular moment. The appraisal amount is the usually the maximum amount a mortgage can be for on a given piece of property.
Get out your latest mortgage statement. Your mortgage statement will have how much you pay each month for your payment, how much of that money goes toward taxes and insurance and how much of that goes toward paying down the principal of your mortgage.
Locate the amount on your mortgage statement that says Total Loan Amount. This is the amount you have left to pay on the principal balance of your mortgage loan.
Subtract the total loan amount or the amount you have yet to pay on the principal balance of your mortgage loan from the appraised value of the home. This is the amount of equity you have in your home. The equity is the value of your home that you have completely paid for. Many people use the equity in their home to seek a home equity loan secured against the paid value of their current home.
Multiply the appraised value of the home by 10 percent and subtract the total loan amount from this figure to determine a second method of computing the value of a home equity. Many lenders will provide secured home equity loans up to 110 percent of the total value of a home.