Finance
What is 'equity' in real estate?
AThe appraised market value of a property
BThe difference between the property's market value and the total loans/liens against it✓ Correct
CThe amount of the monthly mortgage payment applied to principal
DThe interest rate spread between the first and second mortgage
Explanation
Equity is the owner's financial interest in a property — calculated as market value minus all outstanding mortgage balances and liens. Equity grows as the property appreciates in value and as mortgage principal is paid down over time.
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