Is your money trapped? Financial gurus call equity dead money

How to leverage home equity - dead money

I originally wrote this blog as a real estate professional.  Little did I know that I would shift back over to the financial side of real estate and work for CMG.  CMG has a miraculous program, The All In One Loan, that can be the solution to Dead Equity!  This loan program works like no other as it pays down principal first!  It also has a 30-year draw period that keeps your equity available to you.  This available equity can be unleashed with the All In One loan and liquidity returned to the homeowner.  I love this revolutionary loan product!  Give me a call to learn more!!

As you may be aware, the real estate market over the past few years has soared.  Your home’s value has appreciated significantly and you are most likely sitting on a ton of equity!!! Congratulations!!  Your home’s purchase has been a good investment for you.  Equity is great; however, many financial gurus call equity dead money.  They call equity dead money because it is trapped and not working for you.  Here are just three examples of how we can make dead equity work for you.

  1.  We can consider debt consolidation.  Most of my clients carry some consumer debt, such as credit card debt, and car debt.  A common situation that I see is credit card debt of $25,000 with an interest rate of 14% and a monthly minimum payment requirement of 3%.  This is $750 per month.  If you were to unlock some of your home’s equity through a cash-out refinance or debt consolidation, you could pay off this credit card debt.  The monthly carrying cost of the $25,000 drops to about $120 per month providing a $630 per month savings or improvement to cash flow.  These savings could then be used to further reduce debt and/or pay down your home’s principal balance faster.  This is a wonderful way to use your home’s equity and a great debt reduction strategy. 
  2. We can use the equity in your home for renovations and remodeling.  Reinvesting into your home by upgrading your kitchen, bathrooms, and or basement/additional living space, is a smart way to utilize your equity and perhaps even further increase your home’s value.
  3. We can use the equity in your home as a down payment for your next home.  Perhaps, it is time for your family to consider a larger or a smaller home.  Utilizing the equity in your home for your next home purchase is an amazing way to put your equity to work.  You may wish to consider purchasing a new primary residence, a second home, or even an investment home using the equity in your home.

Real estate ownership is and will always be the biggest catalyst for personal wealth.  I am always available to chat about ways to utilize your home’s equity to enhance and speed up your wealth-building plans!  Give me a call or shoot me a message today so we can find the right way for you to continue to grow your wealth and unleash your equity!

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