withAnd with uneven stock market performance, many Americans are experiencing economic pain. In this environment, it may be necessary to explore alternative ways to help make ends meet.
May include its useor . For homeowners with equity in their home, this may mean using a or . Both options allow owners to use the equity they have built up in their home as they see fit. Many homeowners use these options to make major household repairs or renovations, but they can also use them to finance major expenses like a wedding or school tuition.
To get the most out of a HELOC or home equity loan, owners should build up as much equity as possible. Many lenders will let you withdraw as much as 85%, so the more you have, the more you can access. To get to that point, it helps to know how to increase your home equity as quickly as possible.
If you think you might benefit from a HELOC, start exploring your options here now.
How to Increase Your Home Equity Fast
Homeowners can increase the equity in their home in a number of ways. Here are three reliable ways to increase your home equity fast
Make bi-weekly mortgage payments
Many people pay their mortgage once a month for a total of 12 full payments per calendar year. But homeowners looking to build up their home equity quickly should switch to a bi-weekly payment schedule instead. By doing this, they will pay half of their monthly mortgage payment each week, resulting in 26 half-payments (or 13 full) annually. These extra payments add up to fast, shaving years off the top of your mortgage debt (about six to eight, depending on how much you pay). They increase your equity and save you money on the interest you would otherwise have paid in those extra years.
By making bi-weekly mortgage payments, you’ll put yourself in the running for a more substantial home equity loan. Explore your home equity options here to see how much you can withdraw
Make home improvements
If you make substantial improvements or renovations to your home, you can potentially increase its value. That additional value will be reflected in your equityor home equity loans.
Remember: Home equity isn’t just the amount of money you paid for your mortgage. It also includes any additional value your home has taken on in recent years. Let’s say your initial mortgage was $500,000. Since then, you’ve paid $50,000 toward the policy and made improvements that increase the value of your home to $600,000. In this case, you have $150,000 in equity ($600,000 – $450,000), not just $50,000.
So consider doing major home repairs and improvements to quickly increase your home equity. If used for IRS-approved reasonsYou might even be able to Or home equity loans come tax season.
Use your tax refund
If you have not yet filed your tax return for 2022,. But if you’re one of the millions who already filed — and have since received direct deposit — you may be wondering what to use the extra money for. How about using it to pay off your mortgage? Every extra dollar helps (hence the bi-weekly payment schedule). If you can afford to part with your refund, it may be worth doing so if it can knock some of the interest and principal off your mortgage loan (and thus increase your equity).
HELOCs and home equity loans can be smart and affordable ways for homeowners to make ends meet. To get the most out of these credit options, however, it helps to keep as much equity in your home as possible. To build home equity faster, owners should consider making bi-weekly mortgage payments to pay off their balance faster. Home improvements can also increase home value (even if mortgage payments haven’t hurt much to date). Finally, those expecting (or recently received) a tax refund should consider using the extra money to pay down their home loan and increase their home equity.
Learn more about your home equity options here now.