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Return To Equity FAQ Archive   How does a home equity loan work? Answered By Editor Home Equity loans occur when you take out a loan on the equity in your home. Say you have a home loan of around 200,000 and your home has a value of 300,000. You then have equity of 100,000, if you can then take a loan out on that 100,000 with your equity as collateral. If you default on your loan they can, in fact, foreclose on your home. keywords: Equity | Home Equity | Home Equity Loan | Mortgage | Foreclosure It Asset Management

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