Most Millennial Homeowners Don't Know This Key Figure

It's an important number to know.

Owning a home can be a more expensive prospect than renting one. That's because homeowners are responsible for numerous costs, from mortgage payments to property taxes to insurance premiums.

But there's a benefit to owning a home, and it's the chance to build equity in an asset -- one that has the potential to gain value over time. However, most millennial homeowners don't know how much equity they have in their home, according to a recent Hometap report.

Specifically, only about 47% of millennial homeowners can pinpoint that figure, compared to around 54% of Generation X and 69% of baby boomers. But no matter your generation, that's a number you really should be aware of.

How to calculate home equity

Home equity refers to the portion of your home that you own outright. To calculate home equity, all you need to do is take the market value of your home and subtract the amount you owe on your mortgage. So if your home is worth $300,000 and your mortgage balance is $200,000, you have $100,000 worth of equity.

What to do with home equity

Home equity isn't necessarily something you'll do anything with right away. But at times, you might choose to tap that equity when the need to borrow money arises.

In fact, you have two options for borrowing against your home equity -- a home equity loan and a home equity line of credit, or HELOC. With the first option, you take out a lump sum loan that you pay back in monthly installments at a fixed interest rate.

With the second option, you get access to a line of credit you can draw from over time. You only pay interest on the portion of your HELOC you draw from, and your monthly payments may be less predictable than with a home equity loan, since HELOC interest rates are commonly variable.

Borrowing against your home can be an affordable way to come up with the money you need. And to be clear, you can tap your home equity and use the proceeds for any purpose -- it doesn't have to be for home improvements or repairs (though these are common reasons for taking out a home equity loan or HELOC).

Another thing you should know is that the more home equity you have, the more money you stand to walk away with if you sell your home. Knowing that number might guide you to sell at one point in time over another.

Say your home's market value increases, leaving you with $90,000 worth of equity instead of $75,000. You might choose to list your home and take advantage of that opportunity.

Don't be in the dark

The amount of home equity you have is an important piece of information to know. If you're not sure what yours entails, run those numbers so you know what options you have.

Your remaining mortgage balance should be available to you via your most recent home loan statement. You can also look up your home's value online using sites like Zillow. Or, talk to a local real estate agent to get their take.