If you’re lucky enough to have a low, pandemic-era mortgage rate, congratulations! You’re benefiting from record low interest expenses and likely have accumulated a fair amount of equity, too! As time passes since your purchase, you may be considering financing some repairs or improvements to your home.

Here are a few ways to access cash from your equity without losing your current interest rate:

#1: Home Equity Loans or Lines of Credit: A home equity loan or HELOC allows you to borrow up to 95% of your home’s value beyond your current loan(s). This option typically offers lower interest rates compared to other loans and can be a flexible way to fund larger projects. 

#2: Home Improvement or Construction Loans: These loans can be based on your existing equity or, with the right loan type, on the projected value of your home after the project is completed. This option is perfect for significant renovations that increase your home's value. Consult with a Greenway Loan Officer to understand the terms and ensure it aligns with your financial goals.

#3: Personal Loans: Unsecured personal loans are based on your credit history and ability to repay rather than the equity in your home. These loans can be a quicker and simpler solution, though they often come with higher interest rates compared to secured loans.

#4: Credit Cards: Credit cards are often the easiest to use but can be the most expensive option due to high-interest rates. Some homeowners initially charge expenses on their credit cards and later refinance or use an equity loan to pay off the balances. This method requires careful planning to avoid accumulating high-interest debt.

#5: Cash: Using your savings to pay for home improvement can make sense too as it avoids the need to take on additional debt.However, it's important to remember that by tying up your cash in your home, you may need to borrow or sell in the future if unexpected expenses arise.
 

 

Bottom Line:
There are multiple avenues to finance your home improvements without sacrificing your low mortgage rate. It’s essential to evaluate your options and choose the one that best suits your financial situation and goals. Reach out when you’re ready, and the Greenway Team can help you find the best option for your specific scenario. With our expertise, you can make informed decisions to enhance your home and financial well-being.
 

 

Worried about affording a home? You're not alone. Homeownership may seem out of reach, but with the right strategies, you can turn that dream into a reality. Here are 5 effective approaches to help you turn your homeownership dreams into reality:

1. Don't go at it alone: Combine your purchasing power with a coborrower's. It's common for couples to borrow together, yet it's possible to have "non-occupant co-borrowers" too. You can even have more than 2 coborrowers on one mortgage loan.

2. Consider a Hybrid: Increase your buying power with the lower starting rate of a mixed loan program. You'll have a fixed rate and payment for 3 to 10 years before transitioning to an adjustable-rate loan. If you sell or refinance before the fixed period ends, you can avoid paying potentially higher adjustable rates.

3. Go Multi: A multi-family home comes with built-in additional income that can help you better manage your payments and increase your buying power. Some loan programs do not allow the inclusion of the rental income to qualify, so discuss the possibility with us before you decide if it's right for you.

4. Bid Yourself ADU: Just like a multi-family home, a property with a second livable unit (Accessory Dwelling Unit or ADU) can potentially help you qualify for a larger loan.

5. Reduce Your Rate: Seller paid buydowns, paying points, or alternate loan programs can all provide a lower rate.

Taking the first step towards homeownership is easier when you have the right guidance and strategies. By exploring these options, you can enhance your buying power and make homeownership more attainable. Remember, a consultation with us is the best way to determine a comfortable price range for your unique situation. Reach out when you're ready, and we'll be happy to help you find the perfect home within your budget. Your dream home is closer than you think!

You can also get started by getting pre-approved online today!

 

 

With listings harder to find and prices still strong, it may be a good time for homeowners who are still in their larger-than-needed homes to sell.

The current real estate market offers a unique opportunity to unlock substantial equity, which can be a prudent move towards better enjoying your retirement.

The Benefits of Trading Down Can Include:

A Newer Home May Require Less Maintenance

Moving to a newer, smaller home often means less maintenance and fewer repairs. This can be especially beneficial for retirees who want to spend their time enjoying life rather than managing home upkeep.

Reduced Exterior Maintenance

Some homes, such as condominiums, eliminate exterior maintenance and lawn care/snow removal entirely. This can lead to significant savings in time and money, allowing you to focus on activities you enjoy.

Enhanced Lifestyle and Community

A retirement home can come with new friends of the same age, plus abundant activities and amenities for staying active and entertained without breaking the bank. Many favorite retirement areas extend the season for enjoying outdoor activities and provide plenty of incentive for visits from family and friends.

Tax Benefits

You may earn up to $500,000 of gains tax-free if you're married and file jointly. As always, check with your tax professional to be certain.

Financial Freedom 

Purchasing a smaller home may allow for a smaller loan, less general expense, and even the possibility of more cash on hand, all while increasing your quality of life.

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Potential Challenges of Trading Down

Emotional Attachment

Leaving a long-term family home can be emotionally challenging. Acknowledge these feelings and consider ways to honor the memories while embracing the benefits of a new home.

Find the Right Smaller Home

Finding the perfect smaller home can be challenging. Look for a home that meets your current needs and offers future resale value. Consider location, amenities, and the overall community.

Costs of Moving

Moving can be expensive. Plan for potential costs such as hiring movers, closing costs, and any necessary renovations to your new home.

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Practical Steps to Take

Evaluate Your Needs

Assess your current and future housing needs. Think about the size of the home, necessary amenities, and the type of community you want to live in.

Financial Planning

Consult with a financial advisor to understand the full financial implications of trading down. This will help you make an informed decision. You can also reach out to Greenway Mortgage with any questions you have. 

Preparing Your Home for Sale

Maximize your home's value by decluttering, making minor repairs, and staging it to appeal to potential buyers.

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Bottom Line
Trading down your home can offer numerous benefits, from financial savings to an enhanced lifestyle. While it may be emotionally challenging, the potential rewards are significant. If you're considering trading down, evaluate your needs, plan financially, and prepare your home for sale.

Whatever your interest, reach out with any questions. We're happy to help.

888.616.9885 or email us at leads@greenwaylending.com 

 

June is National Homeownership Month, a time to celebrate the value of owning a home and its impact on individuals, families, and communities. This annual observance highlights the significance of homeownership in building strong communities, promoting financial stability, and achieving the American dream.Homeownership is a cornerstone of the American society, providing individuals with a sense of pride, stability, and security. It is not just about owning a piece of property; it is about investing in the future, building equity, and creating a place to call home. Studies have shown that homeownership can lead to greater overall well-being, improved educational outcomes for children, and increased civic engagement within communities.

In This Blog:

• Origins of Homeownership
• Non-Financial Benefits
• Financial Benefits
• Homeownership Statistics
• Free Homebuyer Resources

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Origins of Homeownership Month

Have you ever wondered how National Homeownership Month came to be? Well, let's take a trip down memory lane to the Clinton administration in 1995. It all started as a week-long celebration of homeownership, but it wasn't until 2002 that the U.S. government officially recognized it as a month-long event.

The main goal behind National Homeownership Month is to highlight the importance of owning a home and to shed light on the opportunities it can bring. It's a time to embrace the American Dream and to recognize the significance of putting down roots in a community.

Throughout the month of June, various organizations, government agencies, and housing advocates join forces to provide resources, education, and support to those who dream of becoming homeowners. It's a time to learn, to grow, and to take that first step towards making your homeownership dreams a reality.

So, whether you're currently a homeowner or you're just starting to explore the idea, National Homeownership Month is a great time to celebrate the value of owning a home and to learn more about the opportunities that await you. Let's come together to celebrate the American Dream and the joy of owning a piece of the land we call home.

Non-Financial Benefits of Homeownership

When it comes to owning a home, the benefits go beyond just financial gains. Let's explore the intangible rewards that homeownership brings:

• Pride of Ownership: Your home is more than just a place to live; it's a reflection of who you are. It's your canvas to showcase your personality, style, and individuality, creating a space that truly feels like home.

• Community Engagement: By owning a home, you're not just a resident; you're a stakeholder in your community. Homeownership fosters a sense of belonging and stability, encouraging you to actively participate in local events, initiatives, and affairs, ultimately strengthening the bonds within your neighborhood.

• Stability and Security: One of the most significant benefits of homeownership is the sense of stability and security it provides. Having a place to call your own offers a sanctuary for you and your family, creating a nurturing environment where you can thrive and grow together.

These non-financial benefits of homeownership highlight the emotional and social rewards that come with owning a home, making it not just a financial investment but a cornerstone of personal fulfillment and community engagement.

Financial Benefits of Homeownership

When it comes to owning a home, the advantages extend far beyond emotional fulfillment to include significant financial benefits:

• Forced Savings: Each mortgage payment contributes to your net worth, serving as a form of disciplined savings.

• Equity Growth: Homeownership allows you to accumulate equity over time, providing a valuable asset that can be leveraged for various purposes such as funding education, starting a business, debt repayment, retirement planning, and more.

• Appreciation: Historically, real estate has shown a tendency to appreciate in value over the long term, making homeownership a reliable investment that can yield substantial returns over time.

• Enhanced Financial Security: By owning a home, you significantly increase your net worth, granting you greater financial flexibility and resilience to navigate unexpected challenges or seize new opportunities.

• Protection Against Inflation: Fixed mortgage payments shield homeowners from the impact of rising rental costs, serving as a safeguard against inflation and ensuring financial stability in the face of economic fluctuations.

• Tax Advantages: Consultation with a tax professional can unveil potential tax benefits associated with homeownership, offering opportunities to optimize your financial situation and maximize savings through tax incentives.

These financial benefits underscore the value of homeownership as a strategic investment in your financial well-being and long-term prosperity.

Homeownership Statistics

The latest data provides insight into the impact of homeownership:

• As of the first quarter of 2024, the homeownership rate stands at 65.6%.

• Millennials surpass baby boomers and become the largest group of home buyers at 38%.

• The National Association of Realtors' 2023 Profile of Homebuyers and Sellers reveals that the average age of first-time homebuyers is 35.

• As of early 2024, the average mortgage-holding homeowner holds $299,000 in equity according to ICE’s Mortgage Monitor report. This marks a notable increase from $274,000 at the close of 2022 and a significant rise from $182,000 recorded at the onset of the pandemic.

Bottom Line

As we commemorate Homeownership Month this June, it's essential to acknowledge the profound impact that owning a home can have. From the financial security it offers to the sense of belonging and personalization it brings, homeownership is more than just a transaction—it's a cornerstone of stability and community enrichment. Let's stand together in supporting and empowering individuals on their path to homeownership, paving the way for a brighter and more prosperous future for all.

Free Homebuyer Resources

To support and educate potential home buyers, Greenway provides a wealth of free information and resources.

• FREE First-Time Home Buyer eBOOK – Handy resources & checklists
• First-Time Home Buyer Resources – Learn about our First-Time Home Buyer Programs 
• Home Buying Comparison Chart - Take this chart with you during your home search
• Buying Your First Home – Learn everything you need to know
• Refinance Your Mortgage  - Get a free loan quote
• Renovation Mortgage Programs - Put your home improvement plan into action
• Construction Loans - Can't find your dream home? Build it with a Construction Loan
• FREE Construction Loan Guide Book - Learn everything you need to know about construction loans and the process
• Mortgage Calculators – We have an entire library of easy-to-use calculators!
• Mortgage Terms – Get up to speed on some mortgage terminology
• What to Expect During the Mortgage Process
• When Can You Cancel Your Private Mortgage Insurance? - Find out by using our easy calculator
• Get a FREE Pre-Approval
• Ready to get started? Apply Now using our online application.

 

As your loan balances decrease through regular payments and your home values increase over time, you may become eligible to eliminate your Private Mortgage Insurance (PMI). PMI can add hundreds of dollars to your monthly expenses. By removing it, you can keep that money in your pocket instead.

Moreover, if you now have sufficient equity to drop PMI, you also have enough to secure a Home Equity Line of Credit (HELOC). A HELOC is a versatile financial tool that can be used for a variety of purposes, from funding home improvements to financing higher education.

No Immediate Need For Cash?

This is where the beauty of a HELOC truly shines.

A HELOC can serve as an emergency reserve account to pay for life's unexpected expenses. The best part? If you don't use the funds, you don't make a payment.

Even when you do tap into your HELOC, you typically only need to pay interest on your balance initially. Principal payments are often deferred for 10 years or more, providing you with flexibility and financial breathing room.

In essence, a HELOC offers a safety net for unforeseen circumstances while also providing the flexibility to access funds for planned expenses or investments. It's a financial tool that allows homeowners to leverage the equity in their homes to meet their evolving needs and goals.

Bottom Line

If you're curious by the prospect of leveraging your home equity to eliminate PMI and gain access to a flexible line of credit, it's worth exploring further. Whether you're considering home improvements, planning for the future, or simply want to optimize your financial situation, a HELOC could be the solution you've been looking for.

Ready to explore your options? Let's chat and see if this financial strategy aligns with your goals. The Greenway Team is here to provide personalized guidance and support every step of the way. 888-616-9885