Home Equity Calculator (LTV)
Calculate your home equity (market value minus mortgage balance) and loan-to-value ratio. Useful for refinance decisions, HELOCs, and tracking how fast you’re building equity.
Last updated: September 2026
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About this calculator
Home equity is the portion of your home’s market value that you actually own, free of mortgage debt: equity = homeValue – mortgageBalance. Loan-to-value (LTV) is the mirror image — the percentage of the home’s value that is still financed: LTV = mortgageBalance / homeValue × 100.
LTV is one of the most important numbers in residential lending. Below 80% LTV, private mortgage insurance (PMI) on a conventional loan can typically be removed under the federal Homeowners Protection Act. Below 78% LTV, PMI on qualifying loans terminates automatically. Above 80% LTV, refinancing usually requires PMI or a higher rate. Above 100% LTV (‘underwater’), most cash-out refi options are not available.
Home equity grows two ways: paying down the mortgage principal (the amortized part of each payment) and market appreciation of the home. In many US markets, appreciation dominates in the first decade of ownership; principal amortization dominates later. A drop in home value (recession, local market softness) can wipe out several years of principal payments — track equity annually rather than obsessing month to month.
Equity can be borrowed against via a home-equity loan (fixed rate, lump sum) or a HELOC (variable rate, revolving line). Lenders typically cap combined LTV at 80–85% for these products, so a $400,000 home with $250,000 mortgage supports a HELOC up to roughly (400,000 × 0.85 – 250,000) = $90,000. Rates and terms vary; the pmi-calculator at /en/calculators/real-estate/pmi-calculator/ handles the PMI side.
How to use
Example — $400,000 home, $250,000 mortgage. Equity = 400,000 – 250,000 = $150,000. LTV = 250,000 / 400,000 × 100 = 62.5%. Well below the 80% PMI threshold; if you’re still paying PMI, request removal in writing. Example — $650,000 home, $520,000 mortgage. Equity = $130,000. LTV = 80.0% — right at the PMI threshold. You’ll need to pay down another $2,000–5,000 in principal or wait for appreciation before the lender will drop PMI. Compare with a refinance-savings-analysis at /en/calculators/real-estate/refinance-savings/ to see if the timing lines up with a rate refi.
Frequently asked questions
When can I remove PMI?
For most conventional loans covered by the federal Homeowners Protection Act, PMI can be requested for removal at 80% LTV based on the original purchase price, and terminates automatically at 78% LTV. To use current market value (rather than purchase price), you may need to pay for a lender-approved appraisal and typically wait 2 years (5 years if LTV improvement is from appreciation only). FHA loans have their own MIP rules — MIP is often permanent for the life of the loan on FHA cases originated after 2013.
What is a HELOC and how does it use my equity?
A Home Equity Line of Credit (HELOC) is a revolving credit line secured by your home. Lenders typically cap combined LTV at 80–85%, so max HELOC = (homeValue × 0.85) – currentMortgage. HELOC interest rates are typically variable, tied to prime rate, and interest may be tax-deductible if funds are used to buy, build, or substantially improve the home (post-2017 TCJA rules).
How is home value determined?
Options in order of accuracy: (1) a professional appraisal (~$400–600, most accurate, required by lenders for refi/HELOC); (2) a comparative market analysis from a local real-estate agent (free, uses recent nearby sales); (3) automated valuation models like Zillow Zestimate or Redfin Estimate (free, accuracy varies widely by market). For a rough tracking figure, an AVM is fine; for a real financial decision, get a proper appraisal.
Should I use equity to consolidate other debt?
Sometimes — with caveats. Trading high-rate credit-card debt (20–25% APR) for a HELOC at 8–10% saves interest, but converts unsecured debt into debt secured by your home. Missed payments can now lead to foreclosure. Only consolidate if you have addressed the underlying spending pattern and can absolutely make the new payment. The debt-consolidation-calculator at /en/calculators/debt/debt-consolidation-calculator/ helps compare scenarios.