How do you build Equity?
As discussed last week, Equity is the amount of your home that you actually own. This is the property value – the loan balance = Equity.
The more Equity you have, the better, but how does it actually increase? There are two ways.
1. The property value increases (Mostly to do with luck, market conditions improving value or home improvements i.e Renovations)
2. The amount of debt decreases (This can be due to a shorter loan term, extra payments etc…)
You may be actively or passively trying to increase equity. This depends on your goals, resources and the choices/planning you make.
If you have any questions about equity or how to use it as a deposit on your next home, please give Fiona Ewen a call on 0412411823.
Disclaimer: Your full financial needs and requirements need to be assessed prior to any offer or acceptance of a loan product.