Four Ways You Can Use Your Home Equity
Are you a homeowner? Odds are your equity has grown significantly over the last few years. Equity builds over time as home values increase and you pay down your home loan. Since Kansas City housing prices skyrocketed during the ‘unicorn’ years, you’ve likely gained more equity than you think.
According to the latest Equity Insights Report from CoreLogic, the average homeowner currently has more than $274,000 in equity. That much equity can help you achieve specific goals. In a recent article, Bankrate elaborates:
“While the pandemic created serious challenges, the silver lining for anyone who owned a home was the sizable equity gain. Understanding how home equity works, and how to leverage it, is important for any homeowner.”
Here are a few examples of how you can put your home equity to work for you:
Buy a Home That Fits Your Needs
Does your current space no longer meet your needs? It might be time to consider moving to a bigger home. Similarly, if you have too much space, downsizing to a something smaller could be the perfect choice. Your equity can be put toward a down payment on a home that fits your evolving lifestyle. The Just Say Home KC Team is equipped to help you determine how much equity you have and how to use it when buying your next home.
Reinvest in Your Current Home
Do you want to change your living space but aren’t ready to move? Renovations are a great alternative. Home improvement projects allow you to tailor your home to match your needs and personal style, but it’s essential to consider the long-term benefits certain upgrades can bring your home’s value. Our Just Say Home KC real estate experts know which improvement projects to prioritize to bring you the greatest future return on your investment.
Pursue Personal Ambitions
Home equity can also catalyze realizing your life-long dreams. Are you interested in investing in a new business venture? You may be ready to retire or even need education funding. While equity shouldn’t be used for unnecessary spending, there are many meaningful and impactful ways equity can make a difference in your life.
Understand Your Options to Avoid Foreclosure
The current number of foreclosure filings remains below the norm, so there’s no need to fear a wave of foreclosed homes flooding the market. Unfortunately, some homeowners still experience the foreclosure process each year. If you’re facing financial hardships, clearly understanding your options and how your equity can aid is crucial. During unexpected challenges or unforeseen circumstances that can disrupt your ability to make timely mortgage payments, equity can be a financial cushion. In an article, Freddie Mac explains it this way:
“If exiting your home is the best option for you, selling with equity may be a good option. When selling with equity, you are using the proceeds from selling your home at a higher price than the amount you owe on your mortgage to pay off your remaining mortgage debt.”
Your home equity can be a game changer when reinvesting in your needs and pursuing your goals. It can even help you avoid foreclosure during difficult times. The Just Say Home KC Team is here to give you insight into how your current equity can launch and fund your next move!