Question

Anne bought a home 8 years ago for $154,000 with a $31,000 down payment. She now owes $112,000. Over the past several years, the house appreciated in value and has recently appraised for $250,000. What is the amount of equity that she now has in the property?

a) $150,000
b) $119,000
c) $138,000
d) $138,000

Answer 1

Anne has $138,000 in equity in the property.

Step-by-step explanation:

To find the amount of equity that Anne now has in the property, we need to subtract the amount she owes from the current value of the house. Anne bought the house for $154,000 with a $31,000 down payment, so her initial loan amount was $123,000. Over the years, she has paid off $123,000 - $112,000 = $11,000. Therefore, her equity in the property is $250,000 - $112,000 - $11,000 = $138,000.