How to Calculate Your Home Equity
Home equity sounds simple, but many homeowners confuse it with what they would actually walk away with if they sold. Those are not the same number.
The core formula
Home equity = current home value minus what you still owe. If the home is worth $650,000 and you owe $280,000, then equity is $370,000.
Step one: estimate current value
For decision-making, you usually do not need a perfect appraisal. A credible market estimate, ideally checked against recent local sales, is enough to start.
Step two: use the real payoff balance
Do not stop at your original loan amount. Use the current mortgage payoff amount and include HELOCs or second liens if you have them.
Why equity is not cash in your pocket
Selling costs reduce what you actually keep. Commissions, closing costs, prep work, repairs, and taxes come out before proceeds reach you.
| Number | What it means |
|---|---|
| Equity | Home value minus debt |
| Net proceeds | What you keep after costs and taxes |
Why it matters in keep vs sell
Homeowners often anchor on equity, but the decision should be based on proceeds, monthly carrying cost, and the long-term value of keeping the property instead of selling it.
zamindaro shows estimated equity and net proceeds side by side so the sell decision is based on the number that actually matters.
Start the estimate