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What is home equity?

a.the closing costs associated with buying or renting a home
b.the difference between a home’s market value and the homeowner’s outstanding loan amount
c.the potential rental income that a homeowner can get from the house
d.the difference between the purchase price of the home and its current market price

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Home equity is the market value of a homeowner's unencumbered interest in their real property—that is, the difference of the home's fair market value and the outstanding balance of all liens on the property.

Home equity is determined as the variations between a home’s market value and the homeowner’s outstanding loan value.

Option B is the correct answer.

What is meant by market value?

Market value is the value that is determined as per the market forces of the economy.

Home equity is the value of an unencumbered charge on the homeowner's real property in the market. It is determined by deducting all the due liens from the value of the home or any property in the market.

Therefore, the difference between the market value of a home and its outstanding loan is considered home equity.

Learn more about the home equity in the related link:

https://brainly.com/question/12781629

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