Video with Sumit Joshi, RyRo Loan Centre
What equity is, and how much you can use
- 0:52
- Posted 6 May 2025
- Read the transcript
What this video covers
What equity is, and how much of it you can usually use: 80% of your property value less what you owe. Worked through on a $1 million home with a $500,000 loan.
Related: Using your home equity
Transcript
What Sumit says
0:00What is equity? Equity is the difference between the value of your property minus the outstanding mortgage on it. The next question is what is a usable equity and how is it calculated? Basically, 80% of the value of your property minus the existing loan outstanding is the equity that can be used for a number of reasons. Let's take an example. Let's say the value of your property is $1 million.
0:30And let's say the loan outstanding on that is $500,000. So 80% of $1 million is $800,000. The remaining loan is $500,000. That means there's a $300,000 equity available in your property that can be used.
Transcribed from the video and lightly corrected. General information only, not advice for your situation. See our disclaimer.
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