5 things to do with your home’s equity

Jul 19, 2021

1545

By 21X Team

Everyday we hear more and more about the frenzy that is the Arizona real estate market. The cause is a perfect storm between low interest rates, well-qualified buyers, and low inventory. The result is a perfect opportunity for sellers to cash in on their home’s equity.

In Maricopa, most homeowners are seeing anywhere from $50,000 to $100,000-plus in equity. Like any investment, the equity in your home is only valuable if you have a way to use it. So, here are five things to do with your home’s equity.

Cash-out and sell. The most obvious thing to do with your equity is to cash in on it. Selling your home is the simplest thing to do as it allows you to cash in and walk away. This option is best for those who may be retiring or looking to relocate somewhere new. While walking away with $50,000 to $100,000 seems like a great idea, you will still want to have a plan in place before you think about selling.

Cash-out and pay off debt. Another option is to sell and take advantage of a no-interest option for paying off debt. You can take your home’s equity and funnel it into paying off your vehicle, medical, credit card debt and more. This is a great option for those looking to consolidate their monthly payments. For many, the equity will greatly outweigh the monthly payments leaving an excess to be able to possibly buy another home.

Cash-out and renovate. Could your home use an interior re-fresh? If so, cashing out and renovating may be the option for you. Instead of dreaming of granite countertops or that luxurious soaking tub, refinance and make it reality. This is a great option for those who are happy with the location and general layout of their home but would prefer some upgrades. Cashing out doesn’t always mean you have to move and upgrading your home could help you fall in love with it all over again!

Cash-out and pay for college. Let’s face it, college is expensive! As proud of your kiddo you may be, you’re definitely not ecstatic about the price tag that comes with a college education. By cashing out and refinancing your home you could get your kid through school in the best way – with zero debt. According to consumer reports, student loans are harder to manage than a mortgage. Additionally, student loan interest rates are traditionally higher than mortgage rates. Set your child up for success without breaking the bank by cashing in on your equity to pay for school.

Cash-out and wait. What you do with your equity is your choice. Any of the previous options are great ways to utilize your equity, the only thing you shouldn’t do is let the opportunity pass you by. While the market is hot right now, it may not be in a year. Take advantage now of this unprecedented opportunity with some of the highest home values in decades. If you’re unsure what to do with your equity, an option for you may be to simply cash out and wait.

If you’re thinking about selling your home or interested in what your equity can do for you, feel free to contact the 21X team today! Our real estate experts are ready to help guide you in any type of real estate transaction. You have your own real estate goals, we’re just here to help you reach them.

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21xteam.com
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