What does equity mean/What is equity?

Equity is the perceived amount of the residence that you own.

Don't forget that equity is:

Perceived value of house - Mortgage lien on house = Equity

I specifically stated perceived value of house, because sometimes you get more than the house "should" sell for, and sometimes you get less.

Equity is the amount that you actually own.

The difference between what you owe to your mortgage and what the value of the home is.