Canadians purchase homes for a variety of reasons. Some want the stability of owning their own home, while others also look at home ownership as an investment vehicle. No matter what the reason, the truth is that home ownership has proven itself to be a good stable investment over time, and one which many Canadians are profiting from.
While many people have chosen to purchase their first home during these times of lower interest rates, there has also been a large movement to refinance home loans and pull out equity for home improvements, investments, college expenses, and even high interest debt consolidation. Canadians have been borrowing against their home’s equity in record numbers, taking out billions of dollars in cash each year.
What is home equity? Home equity is the portion of your home that is paid off. It can increase as you pay down your mortgage, or if the property value increases. Home equity loans are a loan that allows you to borrow money using your home equity as collateral.
In years past, many saw their homes as a shelter of safety, yet today, they are more than ever before willing to borrow against the equity owned in their homes to:
Further their investment portfolios,
Get out of debt,
Send their children to university,
Make improvements to their home, or
Boost their RRSP contributions.
Where home equity was once sat upon, today it is something to be tapped out and used to one’s advantage.
While tapping the equity in your home can be a good idea, you should do so with caution and understand any of the possible consequences. The best thing you can do is consult a licensed mortgage professional to discuss opportunities to make your home’s equity work for you.
If you think this option might work for you, please book an appointment at www.askneredafirst.com or call our office at 226-432-2332.