How does equity in a home make money upon resale?

Question

I am completely lost on the concept of buying a home and the selling it before the mortgage is paid. How does this make money/contribute to a new mortgage?

In: Economics

Answer 1

Just because I recently bought and sold be aware that these numbers are examples for simplification. Realtor fees and other costs when buying and selling will add up quickly and can make the amount of equity seem larger than it is. Zillow or another app would give you a decent calculation of approximate costs of fees and better ballpark figures of actual profit and buying power.