The difference between the fair market value of an asset (like a home) and the amount of debt against that asset (like a mortgage balance).
The difference between the fair market value of an asset (like a home) and the amount of debt against that asset (like a mortgage balance).
There are several ways that homeowners can build equity in their properties. They include:
Home equity is an asset that can be borrowed against if necessary, using home equity loans, cash-out refinancing or a reverse mortgage. However, this asset should not be valued lightly or depleted thoughtlessly.