Martha and Gordon purchased a home for 175000 six years ago

Martha and Gordon purchased a home for $175,000 six years ago with a 5.5 percent, 30-year $140,000 mortgage. Their home now has a market value of $210,000 and they owe $134,000 on the mortgage. What is the equity in their home? o $76,000 $70,000 $45,000 $41,000

Solution

The correct answer is $ 76,000

The equity of a home is determined by subtracting the amount owed on the home from its market value..

Equity on the home = $ 210,000 - $ 134,000

Equity on the home = $ 76,000