Ten years ago, Madison and Toby purchased a house for $200,000. Today the market value of the house is $400,000. They still owe a balance of $125,000 on the mortgage. What is their equity in the house?

Question

Quizplus · Accepted Answer

Equity is calculated as the current market value of the house minus the remaining mortgage balance. Therefore, their equity is $400,000 - $125,000 = $275,000.

Ten Years Ago, Madison and Toby Purchased a House for $200,000