True Net Equity™ Explained
Understand what True Net Equity™ is and why it matters more than raw equity.
How True Net Equity™ Works
True Net Equity™ starts with your property value and subtracts everything that would eat into your equity if you sold today: mortgage balance, real estate commissions, closing costs, capital gains taxes, and depreciation recapture taxes.
- Starts with current property value (ARV)
- Subtracts remaining mortgage balance
- Deducts real estate commission (typically 5-6%)
- Accounts for closing costs when selling (typically 1-3%)
- Calculates capital gains tax on profit above adjusted basis
- Includes depreciation recapture tax (25% federal rate)
Why This Matters
Most investors look at equity (value minus mortgage) and think that's what they'd get if they sold. The reality is far different. Selling costs and taxes can eat 30-50% of your equity. True Net Equity™ shows the real number so you can make informed decisions about holding, selling, or refinancing.
- Know your real walkaway number before listing
- Compare selling vs. refinancing with accurate data
- Avoid unpleasant surprises at the closing table
Sample Output
See what this feature calculates for you.
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