Selling a home can take time, planning, and patience.You may have prepared your home, welcomed showings, answered questions, and waited for the right buyer only to have your listing expire without a
How to Turn Your Home Equity Into Big Savings on Your Next Home!
Dated: October 18 2024
Views: 64
Did you know that when you sell your home, you can often put more money down on your next home? This is because the equity you've built in your current home can be used toward the down payment on your next property. And with home equity reaching new heights, down payments are following suit.
According to Redfin, the typical down payment for U.S. homebuyers is now $67,500—a 15% increase from last year and the highest on record!
What is Home Equity?
Home equity is the difference between your home's market value and the amount you still owe on your mortgage. As home prices rise, so does your equity, which means more potential funds for your next down payment. If you've owned your home for several years, you've likely built up significant equity. This is a huge advantage when it comes time to buy your next home.
How Equity Can Help You Make a Bigger Down Payment
When you sell your current home, the equity you've accumulated can be used to make a larger down payment on your new home. This is particularly important if you’ve been concerned about affordability, as putting more money down has several major benefits.
4 Benefits of Making a Bigger Down Payment
- Borrow Less and Save More in the Long Run With a larger down payment, you’ll need to borrow less money from the bank, which means you’ll pay less in interest over the life of your loan. That’s money saved in the long run!
- Get a Lower Mortgage Rate A bigger down payment shows lenders you're financially stable, which makes you less of a credit risk. This can lead to a lower mortgage rate, helping you save even more over time.
- Lower Monthly Payments Borrowing less also means your monthly mortgage payments could be smaller, giving you more flexibility in your budget. You’ll have more breathing room for other expenses or savings.
- Avoid Private Mortgage Insurance (PMI) If you’re able to put down 20% or more, you can skip the cost of Private Mortgage Insurance (PMI). PMI is an extra fee that’s typically required if your down payment is less than 20%, so avoiding it means fewer expenses each month.
Do You Need a Big Down Payment to Buy a Home?
No, you don’t always need a large down payment to buy your next home. There are loan programs that allow you to put as little as 3% or even 0% down. But many homeowners choose to put more money down because of the long-term benefits it offers.
How Much Equity Do You Have?
Curious about how much equity you’ve built in your current home? Knowing this can help you understand your buying power in today’s market.
Thinking about selling your current home and using your equity to buy your next one? The Shasha & Terri Team is here to help! 🏡 Contact us today for a free home equity consultation, and let us guide you through the selling and buying process to maximize your equity and find your dream home.
Shasha Truong & Terri Nguyen Realty Group
🏠Realtors | DRE#01253561, DRE#0144981
📞Call/Text: 626-893-9617 | 626-315-0025
📨Email: shasha.truong@exprealty.com | terri.nguyen@exprealty.com
🌐https://linktr.ee/shashaterrirealtors | www.shashaterri.com
Know Your Home Value: https://www.shashaterri.com/seller/valuation/
Find Your Dream Home: https://www.shashaterri.com/index.php?showagent=1&rtype=map
Complimentary Market Report: https://www.shashaterri.com/market-report.php
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Keywords: home equity, down payment, home buying, real estate, Shasha & Terri Team, selling a home, mortgage rates, private mortgage insurance, buying power
Shasha Truong & Terri Nguyen Realty Group
We are Shasha and Terri, your highly experienced real estate professionals dedicated to turning your real estate goals into reality. Fluent in English and Vietnamese, we bring 27+ years of experience ....
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