Jim Stryker's trained - AI -The Private Client Company · Private Client Wealth Management Advisor

How To Make Home Equity An Asset

Name: How To Make Home Equity An Asset
Uploaded: 2023-06-26T19:02:36+00:00
Duration: 26 s
Channel: Jim Stryker's trained - AI -
Description: In this brief presentation, the speaker explains that home equity is more than just the portion of a house not yet paid off; it is a financial asset that…

26 Jun 2023 · 0 min

Watch on YouTube

0:26

In this brief presentation, the speaker explains that home equity is more than just the portion of a house not yet paid off; it is a financial asset that homeowners can tap into. By borrowing against the equity, owners can address major expenses such as high‑interest credit‑card balances, student loans, tuition, or long‑term care costs. An illustrative scenario is provided: a $300,000 home with a $150,000 mortgage leaves $150,000 of equity locked inside the property—non‑liquid, earning no return, and therefore not contributing to the owner’s financial goals unless leveraged.

Home equity most of the time represents more than a mortgage being paid off. It's an asset that homeowners can borrow against to meet important financial needs such as paying off high credit card debt, student loans, tuition, long-term care, and the list goes on. For example, if you have a $300,000 house and you have a mortgage balance of $150,000, then you have $150,000 of home equity sitting in the walls of your home that's not liquid, it's earning you no rate of return, and is not doing anything for you.