Home Equity Basics

Today’s money tip is about “home equity basics.” When you purchase a home and start making payments, you begin to accrue what is called “home equity.”  Basically, it’s the difference between the current resale value of your home and the amount still owed on the mortgage.  What a lot of consumers don’t realize is that you can very easily make your home equity work in your favor by taking out a home equity loan or line of credit. Borrowing against the equity you’ve built in your home can give you the cash to cover other important extras in your life such as medical expenses, education costs, home improvements or even debt consolidation. If you decide to reinvest the money into your property, you will see the benefits to your living situation immediately, all the while, you’ll be increasing the long-term value of your home.

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