How this number is made
Tappable equity is not the same as value minus the mortgage. Lenders stop at a loan-to-value cap. This page uses the cap you type.
- Value should be one a lender might accept, not a listing you hope for.
- The cap is in the HELOC or home-equity term sheet. 80% and 85% are common. Some go higher.
Formula
Available = value × maximum loan-to-value − mortgage balance. Never below zero.
Worked example
With the figures already in the form, room under the cap is $124,000.
Questions
Can I borrow all of it?
The line limit is also a credit decision. This math only shows the room under the value cap.
What if I have a second mortgage?
Add it to the mortgage balance. The cap applies to all loans on the house combined.