WHAT IS EQUITY?
Simply put, equity is the financial interest you have in your home. To determine your equity, you’d take the fair market value of your property and deduct what amount you still owe on any mortgages. The remaining figure is your equity.
WHAT IS A HOME EQUITY LINE OF CREDIT?
Many homeowners cash in on their property investment with a home equity line of credit. What this essentially means is that the bank looks at your equity (fair market value minus what’s owed) and loans you money based on it. By using your home equity, you may be able to qualify for a large loan at a good rate.
WHAT IS FAIR MARKET VALUE?
Fair market value is the price that a property would hypothetically sell at, given current conditions, trends, and comparisons. It’s conditioned upon several factors, all of which an appraiser would take into account.