Question

Maya owns a house valued at $432,600. She still owes $233,458 on her mortgage. How much equity does she have in the house? (3 points)

Answer 1

No, she is not correct. She has only $30,000 in home equity. Equity is the value of ownership in an asset minus any debts owed on it. $315,000 minus $285,000 is $30,000.

Explanation:

Took it straight from EDG 2022

Answer 2

$199,142

Explanation:

Given that

The value of the house i.e. assets is $432,600

The mortgage i.e. liability is $233,458

We need to find out the equity

As we know that

The accounting equation is

Total assets = Total liabilities + total equity

$432,600 = $233,458 + total equity

So, the total equity is

= $432,600 - $233,458

= $199,142