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  • Suzanne

The Benefits of Growing Equity in Your Home

Over the past few decades, the way we view home ownership has changed. Unlike previous

generations who bought a home with a 30 year mortgage and celebrated the day they made

their last payment, today’s home buyers rarely stay in their home that long. As a result, the

way we view mortgages has changed as well and often buyers are not building the equity in

their homes the way we used to.

But there are benefits to building equity and paying down the loan, here are just a few.

Flexibility – Having equity in your home gives you the flexibility to move if you need to or

want to. For home owners who plan to either buy a large home or perhaps downsize,

having equity allows you to not only put money down on a new loan, but pay for moving

and closing costs.

Safety Net – Life is full of unexpected expenses – job loss or relocation, unexpected

illness or accident, natural disasters – the equity in your home can help you navigate

these unexpected costs with a line of credit or the proceeds from a sale.

Asset Recovery – Many homeowners over the last couple decades have found

themselves underwater in their homes; negative equity. By either making additional

principal payments on the loan or reaping the effect of higher home values, building

equity can help create wealth and turn a negative asset into a positive.

Homeowners might not plan to stay in their homes as long as their parents and grandparents,

but there are still great reasons to focus on building equity in their homes. A home is an asset,

and treated properly is a wealth building tool unlike any other options.

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