Home Equity is the difference between the value of your home and what’s left of your mortgage/loan balance. Your equity increases as you pay down the mortgage balance or if the value of your home goes up.
There are two ways to get equity. With a down payment and with payments to principal or if your home value increases. If you purchase a $200,000 house with a $40,000 down payment. You have $40,000 in equity in your home.
You can use the equity you have to take out a loan or line of credit. (Or you can join a savings club, get inspired and save cash!)
