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    aliseaodo's Avatar
    aliseaodo Posts: 1,671, Reputation: 259
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    #1

    May 20, 2011, 10:59 AM
    equity question
    Trying to get a loan approved for $235,000 - we already own property and are hoping to use our equity in it as the downpayment for this loan. We are waiting for an appraisal of the land to determine the equity. Is equity based on how much the land is appraised at, MINUS what we owe on it?
    ex: appraised at $100,000
    owe <$82,000
    equity =$18,000

    this scenario makes sense to me - just wanting to know if this is how it works... thanks
    LisaB4657's Avatar
    LisaB4657 Posts: 3,662, Reputation: 534
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    #2

    May 20, 2011, 11:25 AM
    Yes, in your example your equity is $18,000. But what do you mean about a down payment for a loan? A down payment is used for a purchase, not a loan.
    aliseaodo's Avatar
    aliseaodo Posts: 1,671, Reputation: 259
    Movie Expert
     
    #3

    May 20, 2011, 12:04 PM

    I'm referring to a home loan - a 3.5% downpayment is required (this is an FHA loan) which would be $8,225. On a $235,000 loan - I was curious how the equity thing worked - trying to get a tentative idea how much we would have to put down out of pocket. Thanks for your quick response!
    LisaB4657's Avatar
    LisaB4657 Posts: 3,662, Reputation: 534
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    #4

    May 20, 2011, 12:07 PM
    So you're talking about a down payment for the purchase of a home using an FHA loan. Ok. Good luck!

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