Equity is generally defined as the remaining difference between the value of one’s home and the remainder of the mortgage loan that they still have to pay off. For instance, suppose home is currently valued at $200,000. If the person owes $150,000 on their mortgage, the equity would be $50,000 ($200,000 – $150,000).
Equity is important because it can often affect a person’s credit, and it can affect the way in which a home is sold on the market. Obviously, equity can change depending on both the current market values as well as the amount of payments made over time. Various laws such as the Home Ownership Equity Protection Act provide protections for homeowners with regards to the available equity.
An equity home loan is a type of financial loan that is lent to homeowners. In such a loan, the borrower uses a portion of their home owner as collateral for the loan that they take out. This can often be helpful if the person needs money, but it will also affect the home equity. Home equity loan lawsuits can sometimes arise if mismanagement of finances occurs.
An equity line of credit is similar to an equity home loan, except that instead of receiving a bulk amount of money, the person is granted a line of credit. This is a revolving line of credit, and must be paid back according to the agreed-upon interest rates. For some homeowners, this may be a more viable alternative than a home equity loan.
Disputes over equity can arise in many ways. For instance, there can be disputes involving the calculation of the actual equity remaining in the home. This usually happens due to errors or discrepancies in the valuation of the home. In such cases, a professional appraisal may be needed in order to arrive at an accurate figure.
In other cases, such as disputes over equity loans or equity credit, a lawsuit may be required to resolve this dispute. This can result in a damages award or other remedies to help the non-breaching party be reimbursed for their losses.
Understanding how home equity works is an important part of home ownership. You may wish to hire a real estate lawyer if you need help when it comes to home equity and other real estate concepts. Your attorney can provide you with legal advice and can advise you on how the laws in your area apply to your case. If you need to file a lawsuit, lawyer can represent you in court and can help argue in favor of your claim.