Equity
mortgage glossary

In housing terminology, equity is the difference in the value of the property and the amount outstanding on any loan secured against it.


To calculate the equity in your home:
Subtract the outstanding loan (the mortgage outstanding) from the property. This is the amount of cash you'd have in your pocket if you sold up now.

If the size of the outstanding loan is greater than the market value of the property, you have negative equity - a situation which became all too commonplace in the early 1990s.

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This content of this site is for information purposes only, as a plain speaking introduction to mortgages. No claim to the accuracy of information on this site is made and you are strongly advised to verify information presented here with a qualified advisor before making any financial decisions based on this information.