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My Available Capital

To refinance your mortgage, the first step is making sure that your equity is higher than 20% of your property value. Your equity is the net value (current real value) of your property minus the balance of your current loan. This is where the current real value of your home really counts.

Let’s say that a few years ago you purchased a $150,000 home with $30,000 down. Since then, you have paid back $20,000 on your mortgage loan, which is now at $100,000. Your equity is therefore $50,000 ($150,000 minus $100,000). However, the value of your home has risen since you bought it and is now worth $200,000. What would your equity be now? Check out the following table.

Refinancing Calculation Table for a House Before Mortgage Loan Maturity
Purchase value $150,000
Down payment $30,000
Repayment of the capital $20,000
Mortgage loan balance $100,000
Available equity $50,000
Current home value $200,000
Amount available $160,000
Mortgage balance $100,000
Available equity $60,000

Because the value of your home has gone up, your equity has also risen from $50,000 to $60,000.

If you have paid back at least 20% of the current value of your home and you have some projects in mind, look into our Homeowner's Kit >>>

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