Home Equity
What your home is worth minus what you owe on it. It is usually most homeowners' largest asset — and their least liquid one.
By Findley's Finance · Last reviewed: September 2026
Why it matters
Home equity grows two ways: paying down the mortgage and the home appreciating. It is real wealth, but trapped wealth — accessing it means selling, refinancing, or borrowing against it, each with costs and risks. Treat equity as a backstop, not a piggy bank: borrowing against your home to fund lifestyle spending is how people lose houses.
Concrete example
A $400,000 home with $300,000 still owed on the mortgage = $100,000 in home equity.