Home Equity: What is it and how does it benefit you?
As a homeowner, over time, you build equity in your property. Perhaps you have heard discussions amongst your friends and acquaintances about them utilizing the equity in their homes in various ways; possibly to remodel their home or make a major repair or to add to the down-payment on a new home. So, you ask, what is equity?
Home equity is a huge benefit of homeownership; is your stake in the property. It is the portion of your home loan that you have paid off. In practical terms, "home equity is the appraised value of your home minus any outstanding mortgage and loan balances.”
Majority of Americans Have a Large Amount of Equity
If you have owned your home for a while, it is likely that you have built up some equity. Based on data from the U.S. Census Bureau, the majority of Americans have a substantial amount of equity right now (see graph below):
These record levels of home equity provide another benefit to millions of homeowners; security against another housing market crash like the one we saw in 2008. Home equity grows over time, providing financial stability while you own your home. And, when you are ready to sell, the earned equity could go a long way toward paying for your next home.
Call, text or email me to find out how much home equity you have and start planning your next move.
If you or anyone you know are facing foreclosure, let's connect so we can develop a plan to avoid you forfeiting your home and loosing the equity you have built.
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