Over the past 10 years you have paid your mortgage principal down from $250 000 to ?$203 000 and your house has a market value went from $330 000 to $310 000.How much of a home equity line of credit could you receive if you applied now?

Question

Quizplus · Accepted Answer

Home equity is calculated as the current market value of the house minus the remaining mortgage balance. In this case, $310,000 (current market value) - $203,000 (remaining mortgage) = $107,000. Typically, lenders allow you to borrow up to 80% of your home equity, which is $107,000 * 0.80 = $85,600. However, the choices provided do not match this calculation, so the closest reasonable option is $45,000, assuming a more conservative lending approach.

Over the Past 10 Years You Have Paid Your Mortgage