Your beautiful home is not just where you live. It’s an investment to grow your wealth. In such fraught times, having a mortgage well cared for is a source of stability. You want to be able to pay off your home as quickly as possible, though. So how can you help your home’s equity grow faster?
Refinance Your Loan
If loan rates of interest have dropped more than one point, it’s time to refinance your loan! This is a new loan with the bank at a lower rate, which can save you a great deal over the life of your loan. Generally speaking, if your credit rating improves enough to drop your access to rate lowering, or if the government lowers interest more than one point, it’s time to see whether a refinance is right for you. Generally, a refinance can be rolled into the cost of the mortgage and pays for itself in under two years.
Remodel Your Floor Plan
Some houses have been built with magnificent style, and some, not so much. If you find that it could be beneficial to lose a wall to create a more open floor plan in an older home or to create a longer room where there was none, it can help your home price as well. Overall, it creates a quality space that is more versatile and allows for better connection. You want there to be the possibility of healthy conversation and atmosphere in your home, and, if possible, the illusion of more space.
Repaying your loan early might seem like an impossibility, but it could be easier than you think. If your job pays you biweekly, this means that twice yearly you get an “extra” check which, if you’re careful, could be outside of your weekly budgeting. This can create two extra mortgage payments per year which can go directly to your equity. Likewise, you can repay your home early by overpaying your mortgage monthly. Again, make sure you stipulate that this amount goes to your balance, not interest, but it can, over time, significantly lower the time remaining on your loan.
Growing your home’s equity makes it possible for you to grow your wealth, and there’s no downside to that! Keep track of if you should refinance, and look into remodeling options for your needs. Always see how much you can “overpay” monthly to shorten your loan length!
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