2021 saw many people looking to buy a home outside of major urban areas. As…
This is one of those topics that they don’t teach you while you are in school. Luckily, you don’t have to figure it out all on your own! We’re happy to help and break down home equity for you.
First things first, let’s start with the basic definition of home equity: it is the difference of what you currently owe on your mortgage and what the current market value of your home is. For example, if your home is currently worth $300,000 and your remaining mortgage balance is $250,000 then you have $50,000 in home equity!
When you first purchase a house, an instant way to build equity in your home depends on your down payment. The more money you put down, the more equity is in your home starting out. Already own your home… Did you know that your equity can increase over time? If you pay more than you owe each month, that’s another great way to boost your home’s equity! If you’re curious to get an idea of what your home equity looks like, you can also look into seeing how much homes in your neighborhood are selling for. Then compare the sold homes features to your home. This will give you a general idea how much your home is worth currently. To get a closer estimate you can always speak to a mortgage expert!