Smart Ways to Build and Grow Equity in Your New Home

Building equity in your new home is something natural that happens over time. Many homeowners choose to implement a few extra strategies to maximize their home’s equity growth. But only some savvy homeowners know the smart ways to build and grow equity in their new home. Who says you can’t build equity in your home faster, too? Lucky for you, we put together this guide to help you get the most out of your home equity.

Put Down at Least 20% or More for the Down Payment

The bigger the down payment you make, the higher your equity in your home will be. Putting more money down now can mean fewer payments over time and lower interest rates from lenders. It also means that should you ever need to sell you’ll have a much larger amount of equity released from your home at the end of the sale. Not only do you benefit from lower payments, but you also benefit from the equity growth of your home.

Know Your Mortgage Terms

Okay, it seems like a no-brainer tip, but believe me, there is something you’re missing out on. Mortgages come in all shapes and sizes, and understanding their terms can be essential for building equity in your new home. Choose your mortgage options wisely and look for any penalties or extra fees that may eat away at your equity. Did you know that some mortgages have a pre-payment penalty? It’s more than important to know your mortgage terms thoroughly before you sign any contracts.

Increase Your Property Value with Home Improvements

Making improvements and upgrades to your home can not only make it more comfortable and enjoyable for you as a homeowner but also help increase the value of your home in the eyes of potential buyers. Simple and inexpensive upgrades like fresh paint, a new carpet, or landscape improvements can all help your home fetch more money when it comes time to sell.

Make Bigger Payments

It’s possible to make additional mortgage payments to pay off the loan faster and build equity more quickly. Making larger payments towards the loan’s principal is a great way to pay off your mortgage faster while also building equity in your home. Paying an extra $100 or so each month might not sound like much, but it can add up over time. In fact, it can shave off years from your loan and save you thousands of dollars in interest over the life of the loan.

Monitor Your Property Value

There are many ways to monitor your property’s value and ensure you’re getting the most out of it. You can hire a real estate appraiser or use online tools such as Zillow or Redfin to get an estimate of what your home is worth. Monitoring your property value can also help you make smart decisions regarding refinancing or making any changes that could affect your home’s equity.

So what’s the takeaway? Building equity in your new home doesn’t have to be a daunting task. All you need is some savvy decision-making and know-how of the right strategies to get the most out of your home equity. With the tips outlined above, you’ll be well on your way to building a solid foundation of equity in no time.…