What’s security and how perform I understand how much We possess? Compare remortgaging mortgages What is security and just how do you require the money your features of your home so you’re able to borrow funds to other purposes otherwise to repay bills? Collateral ‘s the share you possess of your own value of their domestic. Such as for example, whether your house is worthy of ?200,100000 as well as your financial are ?150,000, your equity is actually ?50,100000. Collateral is the worth of your house you don’t shell out people mortgage into. This may involve the level of deposit you to begin with set up when you purchased they. You have to pay off (reduce) your own mortgage debt having an installment home loan (although not an attraction-merely home loan). Quite simply, you only pay from the fundamental mortgage loans to beat what kind of cash you are borrowing from the bank otherwise strengthening community You can work out how far collateral you may have by the deducting your own kept mortgage personal debt on the actual worth of your home. The worth of your property are ?350,000 when you first bought it. You put in in initial deposit regarding ?35,000 and took aside a home loan of ?315,000. You made mortgage payments really worth ?20,100000 which means that your collateral is ?55,100. It departs a rest from ?295,one hundred thousand left to invest on the financial.