Home equity: how much of your home is debt-free?
Home equity is the difference between what your home is worth and what you owe on loans secured on it. With a DKK 4 million house and DKK 2.8 million of debt, you have DKK 1.2 million of equity.
Equity grows as you repay and as house prices rise – and it falls if prices fall. If you have a fixed-rate loan priced below 100, you can repay it for less than the outstanding debt, so your equity at today's price is larger than the nominal figure.
You can use the equity by borrowing against it – with a top-up mortgage loan up to 80% of the value (75% for holiday homes) or with a bank loan. It only becomes cash when you sell or borrow.
- Your equity (nominal)
- DKK 1,500,000
- Loan-to-value
- 62.5%
- Lending limit (80%)
- DKK 3,200,000
- Available mortgage room
- DKK 700,000
- Principal before costs.
Equity over 10 years
The price change is your own estimate – not a forecast.
How we calculate
- Equity = the home's value minus all debt secured on the home.
- For repayment at today's price we use the loan's price; a fixed-rate loan is repaid at no more than 100.
- The development over time uses the price change you choose and the loans' repayments.
Questions for your bank meeting
- Can I move the loan to another institution later – and what does it cost?
- What is the total cost over 10 years including all fees – both the institution's and the bank's?
- Which loan types can I get with my debt-to-income ratio and loan-to-value – and why?
- Which disposable amount do you require, and what does my budget look like after the loan?
realkredit.ai provides general information and calculations – not personal, legal or financial advice, and nothing here is legally binding. The figures are indicative and based on your own numbers and the prices we have verified. Always check your loan offer, and talk to your bank, an independent adviser or a lawyer before you decide.