Are you on the fence about selling your house? While affordability is improving this year, its still tight. But understanding your home equity could be the key to making your decision easier.
In the past few years, home prices skyrocketed, which means your home's value and your equity likely shot up, too. So, you may have more equity than you realize.
American homeowners are sitting on tremendous equity. Over of homeowners have either completely paid off their mortgage or have at least 50% equity. According to CoreLogic, the average homeowner with a mortgage has $298,000 in equity.
The Easy Way To Find Out How Much Equity You Have
To find out how much equity you have in your home, ask a real estate agent you trust for a Professional Equity Assessment Report, also known as PEAR. This report evaluates how much equity you have based on the current value of the home and how much has already been paid off.
You can roughly estimate how much equity you have by subtracting all the amounts owned on the property still with the homes value. Knowing how much you still owe and how much you have paid off can be a tremendous bargaining tool when considering a move.
How To Make the Most of Your Home Equity Right Now
If you're thinking about moving, the equity you have in your home could be a big help.
After you sell your house, you can use your equity to help you buy your next home.
Heres how:
Be an all-cash buyer: If youve been living in your current home for a long time, you might have enough equity to buy your next home without having to take out a loan. If thats the case, you wont need to borrow any money or worry about mortgage rates.
Make a larger down payment: Your equity could also be used toward your next down payment. It might even be enough to let you put a larger amount down, so you wont have to borrow as much money.
Bottom Line
Planning a move? Your home equity can help you out. If you have been wanting to move but are scared of the cost, consider your equity. The time and effort you spent on your current home can propel your next move.
Still have questions? Reach out to your local Seven Gables agent to learn more about how much equity you hold.
