Today we’re getting to the bottom of building equity in a home. —Trust me, this is one of the most important topics for your financial future. Beyond the obvious benefits of owning your own home, it’s an investment. When done correctly, it offers significant financial advantages. Below are the top 3 ways building equity can help you create a strong foundation of future wealth.
1. The option to tap into the value of your home Your property appreciates over time, which means so does your equity. When deciding to sell, refinance or take out a home equity loan, your equity gives you a valuable asset at your disposal. With the option to borrow against your home, you could renovate, pay for your children’s education, start a business, etc.
2. A pathway to future financial stability While you can never get back what you pay in rent, mortgage payments are an investment in your equity. With each mortgage payment, your debt decreases, and ownership increases.
3. Potential tax benefits You may be able to deduct the interest you pay on your mortgage and your property taxes from your taxable income. Consult a tax professional on the specific benefits available to you.