--- title: What is home equity? description: There are several ways to tap into home equity and some important questions to ask before deciding the best way for you. image: https://go.hfcu.org/hubfs/images/House%20on%20Money.jpg --- [![MoneyWisdom_HFCU_r2](https://go.hfcu.org/hs-fs/hubfs/MoneyWisdom_HFCU_r2.png?width=464&name=MoneyWisdom_HFCU_r2.png "MoneyWisdom_HFCU_r2")](https://go.hfcu.org/blog) Filter by Category** - [Show All](https://go.hfcu.org/blog) - [Security](https://go.hfcu.org/blog/topic/security) - [Personal Finance](https://go.hfcu.org/blog/topic/personal-finance) - [Auto](https://go.hfcu.org/blog/topic/auto) - [Business](https://go.hfcu.org/blog/topic/business) - [Credit Score](https://go.hfcu.org/blog/topic/credit-score) - [Home](https://go.hfcu.org/blog/topic/home) - [Credit Cards](https://go.hfcu.org/blog/topic/credit-cards) - [Life Changes](https://go.hfcu.org/blog/topic/life-changes) - [Insurance](https://go.hfcu.org/blog/topic/insurance) - [Investments](https://go.hfcu.org/blog/topic/investments) Filter by Category** - 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[dormant account (1)](https://go.hfcu.org/blog/topic/dormant-account) - [inactive account (1)](https://go.hfcu.org/blog/topic/inactive-account) # What is home equity? ** [Hanscom Federal Credit Union](https://go.hfcu.org/blog/author/hanscom-federal-credit-union) ** Nov 21, 2016 ![House on Money.jpg](https://go.hfcu.org/hubfs/images/House%20on%20Money.jpg) Home equity is the difference between the appraised value of your home and any current mortgage balance(s). For example, if your home is currently appraised at $325,000 and you owe $200,000 on your mortgage, your home holds $125,000 in equity. As the value of your home increases and you continue to pay down your mortgage, the equity in your home increases. Recent rising residential real estate values are pushing home equity totals to record levels, opening up a fresh source of revenue for many homeowners. [*The Washington Post* reports](https://www.washingtonpost.com/realestate/many-owners-seem-unaware-of-the-home-equity-they-could-easily-tap/2016/07/19/e2694dd2-4cf0-11e6-a422-83ab49ed5e6a_story.html) that total home equity in the United States surpassed $13 trillion in early 2016, more than double what it was in 2011, and [Forbes.com reports](http://www.forbes.com/sites/ashleaebeling/2016/03/31/your-neighbor-got-a-heloc-should-you/#f07925f1637f) that the average home equity available for over 37 million American borrowers is $112,000. As home equity values increase, homeowners are borrowing against the equity in record numbers. In fact, [NerdWallet](http://www.nerdwallet.com) reports that lenders handed out $156 billion in home equity lines of credit (HELOCs) in 2015, a 24% increase from a year earlier and a 138% rise from 2010. The most common reasons cited for borrowing include: home improvements, debt consolidation, emergencies, college costs and retirement. If you are considering borrowing against the equity in your home, do your homework. There are several ways to tap into home equity and some important questions to ask before deciding the best way for you. This information is just some of what’s included in [*Equity Edge: Answers to Commonly Asked Questions*](https://go.hfcu.org/equity-edge), a free offering from Hanscom Federal Credit Union to help you make an educated decision.     ** [Home](https://go.hfcu.org/blog/topic/home) [** Find Out if Your Retirement Income is Taxable ](https://go.hfcu.org/blog/is-your-retirement-income-taxable-it-depends-) [** How to Qualify for a Home Equity Line of Credit ](https://go.hfcu.org/blog/how-do-i-qualify-for-a-home-equity-line-of-credit) ### About Author ![Hanscom Federal Credit Union](https://go.hfcu.org/hubfs/HFCU-Profile-1000x1000.jpg) Hanscom Federal Credit Union Hanscom Federal Credit Union, a purpose-driven $1.9 billion organization based in Littleton, MA, empowers its members to achieve financial wellness. Hanscom FCU serves over 95,000 members across the country and overseas through 16 branches, over 100,000 surcharge-free ATMs, 5,000 contact centers, and a web-based branch. 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