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Home equity is the portion of your home that you own outright. It's calculated by subtracting your mortgage balance from your home's current market value.
In Depth
Home equity represents the financial value you have built up in your home. It's the difference between what your home is worth today and how much you still owe on your mortgage. As you pay down your mortgage and as your home's value increases, your equity grows. This equity can be a valuable asset, potentially used for loans or lines of credit.
Example
If your home is valued at $300,000 and you still owe $100,000 on your mortgage, you have $200,000 in home equity.