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What’s your property’s equity?
Understanding property finance 👉3

Welcome back to the Wealth Through Property series.

What is equity? Quite simply, equity is the difference between your loan and your property value. If your property is worth $500,000 and you have a $320,000 loan, the difference is $180,000 which is what you would theoretically get if you sold the property. This is what we call equity.

Since the banks won’t lend you 100% of a property’s value, you need to put down a deposit to secure your loan. Say you put down a 10% deposit of $50,000 on a $500,000 property. Your LVR limit will be 90% with an equity of $50,000. Should you decide to make a withdrawal on your mortgage later on, you will not be able to take out more than this 90% LVR limit.

Join me for my fourth property finance insight.

Stay tuned for more daily insights from Wealth Through Property.

~Daimien Patterson
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Legal Disclaimer: This information ('the information') is presented for illustrative and educational purposes only. It is not presented nor should it be treated as real estate advice, legal advice, investment advice, or tax advice. All investments involve risk and potential loss of money. If you require advice in any of these fields you should contact a suitably qualified professional to assist and advise you. Your personal individual financial circumstances must be taken into account before you make any investment decision. We urge you to do this in conjunction with a suitably qualified professional. Daimien Patterson, IntegrityX Enterprises Pty Ltd, and their associated trading names, companies, researchers, authorised distributors and licensees, employees and speakers do not guarantee your past, present or future investment results whether based on this information or otherwise. Daimien Patterson, IntegrityX Enterprises Pty Ltd and their associated trading names, companies, researchers, authorised distributors and licensees, employees and speakers disclaim all liability for your purchase decisions. You should do your own independent due diligence and seek the advice of qualified advisors before making any investment decision.