Mortgages and mortgage advice, this is your route

  Home  |  About Mortgages  |  Sourcing Tools  |  Calculators  |  Key Facts  |  A to Z       Contact Us
You are here: Mortgage Route > Glossary A to Z > Letter E
 

The Mortgage Route A to Z
Equity

This glossary or A to Z should help clear up any confusion as to what terms mean what in the mortgage and insurance industry

Did this page help you?

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Letter E

Equity

The stake in your home that belongs to you over and above what is outstanding to the mortgage company.
As the property value rises and falls so does the value of your equity. As such if the property falls below the value of your mortgage you will be in negative equity.

If the property rises considerably you are able to release equity by either re-mortgaging, using a drawdown facility, if you have one, or taking a further advance.

Other than inflation your equity can also increase if you carry out home improvements to your property such as an extension or conservatory. However your equity does not normally increase in line with the cost of the improvement, so as a rule of thumb improvements should be for your benefit rather than how much they will improve the value of the house this can be in some cases false economy.

FSA declaration and important text about mortgage advice