A few years ago, simon powell purchased a home for $225,000. today, the home is worth $400,000. his remaining mortgage balance is $175,000. assuming that simon can borrow up to 75 percent of the market value, what is the maximum amount he can currently borrow against his home?

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Kareem Holt

22 October, 16:29

A few years ago, simon powell purchased a home for $225,000. today, the home is worth $400,000. his remaining mortgage balance is $175,000. assuming that simon can borrow up to 75 percent of the market value, what is the maximum amount he can currently borrow against his home?

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Marilyn Johns · Answer 1

To find Simon's maximum amount he can borrow against his home you will use the Home Loan Value Formula.

Home is worth: $400,000

Remaining balance: $175,000

Borrow: up to 75% on home

First, you'll want to take the market value of $400,000 and multiply it by 75% (.75) which gives you $300,000.

Then, you'll need to subtract what Simon owes on the home to find the amount he can borrow.

$300,000 - $175,000 = $125,000

Simon can borrow $125,000 against his home.