The formula to calculate the Home Equity Percentage (P) is:
\[ \text{P} = \left( \frac{\text{E}}{\text{V}} \right) \times 100 \]
Where:
Home equity percentage is a measure of the portion of your home that you truly own. It is calculated by dividing the amount of equity you have in your home by the current market value of the home, and then multiplying by 100 to get a percentage. This percentage can be an important factor when considering refinancing, selling your home, or taking out a home equity loan.
Let's assume the following values:
Using the formula:
\[ \text{P} = \left( \frac{100,000}{400,000} \right) \times 100 = 25 \]
The Home Equity Percentage (P) is 25%.