Here we are again! I can't believe it's already August.
Summer just started... right?
August's Term of the Month is "equity". Never having bought a house (or any large purchase really), I've never known the exact definition of equity. It's really very simple.
Equity - the value of real estate over and above the liens against it. It is obtained by subtracting the total liens from the value.
For example, say you own a house worth $200,000. You still owe $150,000 on the house, meaning that your house has $50,000 in equity. Liens can include more than just a mortgage. For example, property taxes and Homeowner Association fees are also liens.
Summer just started... right?
August's Term of the Month is "equity". Never having bought a house (or any large purchase really), I've never known the exact definition of equity. It's really very simple.
Equity - the value of real estate over and above the liens against it. It is obtained by subtracting the total liens from the value.
For example, say you own a house worth $200,000. You still owe $150,000 on the house, meaning that your house has $50,000 in equity. Liens can include more than just a mortgage. For example, property taxes and Homeowner Association fees are also liens.
"Equity - the value of real estate over and above the liens against it. It is obtained by subtracting the total liens from the value."