For centuries, alchemists looked for a magical way to turn cheap metal into gold. They failed, because (spoiler alert) magic isn’t real, and if someone told you they had a spell to turn your house into money, you’d be right to send them packing.

But every day, math is working magic on your home’s value in the form of appreciation — the increase in your home’s value over time. And as your home appreciates, it builds your equity, which is the amount of your home that you actually own.

The math of home equity is simple:

Home Equity Equation

Here’s some even better math: In 2021, home price appreciation averaged 15% … more than double the 6% average of 2020. 1That means that your home value is likely a lot higher than when you bought your house and tapping into that equity could have a magical effect on your financial goals.

National Home-Price Growth1

National Home Price Growth

By refinancing your home and cashing out your equity, you gain money to spend any way you want. Renovate your home, pay off high-interest debt, cover tuition costs, or fulfill any other financial goal. It’s not quite as simple as waving a wand, but it’s pretty close!



1 U.S. Federal Housing Finance Agency, Purchase-Only House Price Index, Seasonally Adjusted.