Are you looking to dip into your home’s equity? Whether you’re planning a kitchen remodel or planning to fund a college education, the possibilities are endless when you have the power of home equity on your side. First, let’s answer a couple questions:
What is home equity? Home equity is your share of the value of your home. It’s what you truly “own” and have an interest in. This value builds up over time as you pay off the mortgage and the market value of your property appreciates.
What is a home equity loan? It’s a type of loan in which the borrower can use the equity of their home as collateral to guarantee the loan which typically leads to lower interest rates and potential tax benefits.
What can I use my home equity for? Anything. You might use it to purchase your next home, make improvements to your current home, reduce those pesky high-interest rate credit card debt, jumpstart your dream business or fund a college education.
How can I build my home equity? As you repay your mortgage, your home equity increases. Each monthly payment decreases the amount of interest you pay along with reducing your loan balance. Therefore over time, as more money goes toward your loan balance your home equity will increase. Your home equity will also be accelerated if the value of your home increases over time.
Want to get started? Take some time to find out how much equity you have in your home with this home equity calculator.