<human>:  How does the equity in my home work?
<bot>: The equity in your home is the difference between the current market value of the home and the amount you owe on the mortgage. The more equity you have in your home, the more owning the home costs you. This is because the more equity you have, the more you owe on the mortgage and the more interest you have to pay. As you pay off the mortgage and build up equity in your home, you may also be able to borrow against that equity. This is known as a home equity loan or a home equity line of credit. By borrowing against the equity in your home, you can use the money for any purpose you see fit, typically either to make improvements to the home or to invest it in some other way.