Thursday, 4 April 2013

How Homeowners Invest with Equity Credit Lines?

Let’s discuss some money saving tips and ways homeowners use mortgages and loans for investment purposes. Homeowners are typically paying off a fixed or adjustable rate mortgage. In either case over time they are building up what real estate agents and lenders call equity. Unlike paying rent on an apartment, the money you are spending on that loan is essentially going into an investment account. This money you are entitled too at any time.

What to do with equity

Fixed rate home loans as well as adjustable rate loans build up equity over time as you pay them. When you’ve built up a certain amount of equity you might consider using a home equity credit line to invest in other areas of your life. Here are some great reasons you might think about using a HELOC loan.
  • Some people use Home Equity Credit Lines to consolidate high interest debt. This lowers their monthly payments on other debts.
  • This equity credit can be deducted from your taxes! If you have enough qualifying expenses to itemize deductions this investment is solid.
  • Lenders will often allow home owners to switch from an adjustable rate mortgage over to a fixed rate when they take out a home equity loan. This means people who used the advantages of adjustable rate mortgages to help buy a home initially can now benefit from the stable monthly payments involved with a fixed rate home equity line of credit.
  • This money is accessible any time for credit checks and is very easy to use.


One of the best differences between an equity credit line and other types of loans is that the interest you pay on a HELOC is tax deductible. This money can be used for whatever you want. Many people use this money to help fund investments like higher education. Others have used it to take that vacation they always dreamed of. Perhaps you have a business idea and need some money to get that started. Because you are essentially spending your own money that you’ve put into your home, you can do whatever you like!

What type of financial decision will you make?

Perhaps the wisest financial decision to make when you refinance a home equity line of credit is to reinvest it right back into your home. Since your house is perhaps your most important asset, improving that asset makes sense doesn’t it? Today you can make “green” improvements on their home such as adding solar panels. In case you haven’t heard, the government gives tax breaks for homes built with green improvements. Something like solar panels or energy efficient heating systems will also save you money in the long run.

Big decisions need careful thought

Always remember that this is another big financial decision. The progress you made towards paying off your mortgage entirely will take a step back. Thus, it might take you longer to eventually own your home outright if that was your ultimate goal. However if you invest your money wisely you could potentially take a giant leap forward financially in the long run.

To get some really helpful and honest advice on how to use home equity lines of credit visit the website They have advisers and agents available all over the U.S. that can help you make the right choices in home ownership. Call them today at 1-800-987-1397 for a free consultation. 

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