If you’ve already paid off some of your original mortgages, you might be able to use this equity to help you buy a second property.
The process is best illustrated with a specific example. Imagine that a few years ago, you purchased a house valued at $500,000. So far, you’ve paid off $200,000 of this, while $300,000 remains unpaid. At this point in time, you spot a highly promising new property and wish to buy it as an investment. In order to put money towards this new property, you can “free up equity” from your original house. As much as $200,000 can then be used to help you secure the second house.
This can make sense for a variety of reasons. Before you commit to it, though, it’s important to consider your various options carefully and know exactly what you’re doing. Hefty hidden bank fees lie in wait for the person who rushes into such things!
A One50 advisor can help you navigate this complex terrain, and ensure that you choose the best option when you’re looking to buy a second home.
To find out more about whether freeing up equity could be right for you, contact us today.