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Equity

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The equity in a piece of real estate is the difference between what you owe and what it is worth. You can think of your equity as the part of your home value that you “own”. As your home value increases and your loan balance decreases your equity increases. You can turn a portion of your equity into cash by borrowing against it, either by refinancing or taking out a second mortgage or home equity line of credit. Generally, the only way to liquidate all of your equity is to sell, but a portion of your equity will go to paying Realtors and transaction costs. When selling, remember that your equity (on paper) is more than the amount of cash that you net from the sale.


Additional resources

In addition to our glossary, we have a library of downloadable PDFs that cover closing costs, escrow, and other mortgage fundamentals.

An outline of estimated closing costs, Initial Loan Document guide, Conditional Approval, Home loan closing, Processing, Underwriting

Downloadable PDF

Closing Costs

What is escrow? Property Taxes and Escrow

Downloadable PDF

Escrow


Want to learn more? We have an ever-growing library on our YouTube channel.


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We have a growing YouTube library of videos covering every part of the mortgage process. Head over and explore, and don’t forget to subscribe (and turn on notifications so you don’t miss new videos!)


The Workshop Team are Employees of Rate, Inc.