Financial well-being June 28, 2024 By
As life evolves and your family expands, so should your living space. If your family is outgrowing your starter home, fear not! In this blog, we'll explore strategic ways to leverage the equity in your current home to transition into your dream, larger abode smoothly.
Evaluate Your Equity
Start by assessing the equity you've built in your current home. Understanding this financial foundation sets the stage for a well-planned transition.
Consider a Home Equity Loan or Line of Credit
Tap into your current home's equity with a fixed-rate Home Equity Loan. This lump sum allows for a substantial down payment on your next home, securing favorable terms on your mortgage. Another option is a more flexible Home Equity Line Of Credit (HELOC) to access funds as needed during the transition. This dynamic approach enables you to seize opportunities in a competitive market or handle unexpected expenses.
Sell First, Buy Later
Maximize your equity by selling your current home before purchasing the new one. This approach ensures a clearer financial picture and may provide the necessary funds for your larger home's down payment.
Leverage Tax Advantages
Unlock potential tax benefits by understanding the implications of mortgage interest deductions and capital gains exemptions. Strategize with a financial advisor to optimize your tax situation during this transition.
Tax Implications: A Key Consideration
Be mindful of tax implications when utilizing your home equity. While interest on home equity loans is often deductible, recent tax changes have altered some rules. Consult with a tax professional for guidance.
Ready to embark on this exciting journey? Connect with a First United Mortgage Loan Officer to determine your home loan options.
