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Equity (housing)
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Equity in housing terminology 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 ou 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 common-place in the early 1990s.
Meanwhile, the same term equity is used in the stockmarket with a slightly different meaning!
See Also: Mortgage Centre and Mortgage comparison Service for the latest facts and figures.
Last Updated: June 2007 © Moneyextra.com
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