As a homeowner, your home’s value has likely risen significantly in recent years, boosting your equity as you pay off your mortgage. With the recent surge in home prices, your gains might be greater than you think.
The latest CoreLogic report shows that the average homeowner now holds more than $274,000 in equity, offering a substantial resource to achieve your goals. Here are a few examples of how you can leverage this equity to your benefit.
1. Buy a Home That Fits Your Needs
If your current place doesn’t work for you anymore, you might want to consider a bigger home. And if your place is too big, a smaller one could be better. In both cases, you can use your equity as a down payment for a home that suits your new needs. A real estate agent can assist in calculating your equity and guide you in using it for your next home purchase.
2. Reinvest in Your Current Home
If you want to change your living space but aren’t ready to move, renovations are a good choice. They let you customize your home to your liking. Remember to think about how certain upgrades can increase your home’s value over time. A real estate expert can guide you on which projects to focus on for the best return when you eventually sell.
3. Pursue Personal Ambitions
Your home equity can help make your lifelong dreams come true. This might include starting a business, planning for retirement, or paying for education. While it’s best not to spend it frivolously, using your equity wisely for important goals can have a significant positive impact on your life.
4. Understand Your Options to Avoid Foreclosure
Currently, foreclosure filings are not unusually high, so there’s no need to worry about a flood of foreclosed homes on the market. However, some homeowners still go through foreclosure each year. If you’re in financial trouble, it’s important to know your options and how your equity can assist. Your equity can serve as a financial safety net during unexpected situations that might affect your ability to pay your mortgage on time.
Bottom Line
Your equity has the potential to make a significant difference in funding your needs, achieving your goals, and even preventing foreclosure in tough times. If you’re uncertain about your home equity, let’s get in touch to begin strategizing your next steps.
