Hometap

Your home's market value is what buyers would pay for it today — and it's a key part of figuring out your equity. Subtract what you still owe on your mortgage and any other liens, and what's left is the equity you've built.

Once you know that number, you can start to see your home as an asset you can put to work. That's the realization that led Daniel to explore his options. A home equity investment gave him access to his equity in cash in exchange for a share of his home's future value, with no monthly payments during the 10-year investment term.

Curious about your home's equity? Learn more on our website.

hometap.com/blog/how-to-calculate-home-equity?utm_source=facebook&utm_medium=organic_social&utm_campaign=homeowner_education&utm_content=glossary_marketvalue

"Why wouldn't I just take out a HELOC?"

This a common question for today's homeowner who are reviewing their options. The truth is that sometimes, a HELOC is the better fit. It works differently than a home equity investment, so the right option depends entirely on your situation and goals.

Here's the comparison on an $80,000 project.

A HELOC is a revolving line of credit secured by your home. You're approved for a set amount and draw cash as you need to, which means you pay interest on the amount you draw. The trade-off is that you have a monthly payment. That rate can be variable, so it could change over the life of the HELOC.

With a home equity investment, you'd receive the $80,000, minus applicable costs and fees, as a lump sum and make no monthly payments. Instead you settle by the end of the term — typically when you take out a loan, refinance, buy out the investment with savings, or sell your home — and the settlement is based on a share of your home's value at that time. If your home has appreciated, the settlement amount reflects that.

There isn't a "winner" here. But there is a fit. There are two questions to consider: what can your monthly budget comfortably carry, and when do you realistically expect to sell or refinance?

You can learn more here: https://bit.ly/4zROE6w

The largest asset most homeowners have is the one right under their roof: the equity in their home. It grows steadily over years of mortgage payments and rising value — but until you sell your home, it can feel locked away when you could use some breathing room.

It doesn't have to. If you're carrying higher-interest balances, the equity you already have is one way to access funding without adding another monthly payment to your budget. A home equity investment gives you that cash in exchange for a share of your home's future value or appreciation, with no monthly payments during the investment term.

It's one option (among several) for accessing your equity, and it's worth understanding alongside home equity loans, HELOCs, and personal loans — just to name a few. Swipe through for the details, and learn more here: https://bit.ly/4xS2aF8

Your mortgage payment is the one number in homeownership that mostly stays the same. Everything around it, on the other hand, continues to shift.

Property taxes get reassessed. Insurance premiums (usually) increase. Utilities spike with the seasons.

None of it typically moves very dramatically in a single month, which is exactly why it's easy to miss until you compare bills year over year.

Add all of the costs up, and the gap between "my mortgage payment" and "what my home actually costs" is much wider than most budgets assume — and it grows even in a year where nothing else about your house changes.

If you haven't run the numbers recently, it's worth doing. Our Cost of Homeownership Assessment walks through it: https://bit.ly/4hYNzTP