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For first mortgages that have subordinate financing under a HELOC, the lender must calculate the HCLTV ratio. This is determined by dividing.
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How to Calculate Home Equity. This is the amount you have left to pay on the principal balance of your mortgage loan. Subtract the total loan amount or the amount you have yet to pay on the principal balance of your mortgage loan from the appraised value of the home. This is the amount of equity you have in your home.
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