If you’re a homeowner, chances are that you have equity in your home thanks to rising property prices. That’s why it comes as no surprise that many homeowners are tapping into the equity in their homes to get cash for home improvements. But, did you know there are lots of other ways you can use capital in your home?
With that said, you have several different loan options, including a home equity loan, HELOC (home equity line of credit), and even cash-out refinance. All these options can help make your life a lot easier in a number of ways.
Using Equity in Your Home to Pay for a Vacation
Taking a vacation is a crucial way to spend some time away from the hustle and bustle of work and life. It allows you to reinvigorate your mind, re-energize, and come back rejuvenated. The trouble, however, is that a vacation can be pricey.
So, instead of using a high-interest credit card or borrowing a personal loan, consider leveraging the equity in your home to finance your holiday getaway.
Plan a Wedding
It’s no big secret a wedding is a huge financial undertaking. From hiring the caterers and renting the venue to paying for a honeymoon and every expense in between, wedding planning needs a bottomless fund. That’s where a cash-out refinance of your mortgage can be useful.
Pay for Your Children’s Braces, Dental, Etc.
You want the very best for your little one – it’s only natural. But things like braces cost a fortune. Lucky for you, you can borrow against the equity in your home to ensure that your child has a fabulous smile.
Pay Off Student Loans
Did you know Americans owed over $1.3 trillion in student loan debt? If you’re among the four in 10 adults who owe a massive debt in student loans, you can use the equity in your home as your magic wand. It’ll help you pay it off sooner than later, saving lots of money on interest. Besides, HELOC or home equity loans can help you consolidate your student loans.
Get a Handle on Emergency Expenses
Unexpected expenses are part of life. Your car can break down, emergency medical bills can arise, and so forth. What can one do in such a situation? If you’ve got equity in your home, don’t run to payday lenders or loan sharks. Just top-off or redraw the amount you’ve paid in your mortgage, and you’re all set.
You can also take advantage of the equity in your home to pay off credit card debt, pay utility bills, and even invest in the stock market.