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Columbia Missouri Real Estate ~ House Hunt Form
Use this form to tell us about the home you are looking for. We'll perform a search for you and contact you with a list of properties that match your requirements.
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Wealth and Equity
Over the many years that you own your home, it should become an important part of your financial net worth -- that is, the difference between your assets (financial items of value that you own such as bank accounts, retirement accounts, stocks, bonds, mutual funds, et cetera) and your liabilities (debts). This is because homes generally increase in value over time while you're paying down your loan (mortgage debt) used to buy the home.
Home equity (which is the difference between the market value of a home and the outstanding loan on the home) will help your personal and financial situation in a number of ways. If you plan to someday retire, your home's equity can help supplement your other sources of retirement income.
Tapping into equity
How can you tap into your home's equity?
Some people choose to trade down -- that is, to move to a less expensive home in retirement. Sell your home for $250,000, replace it with one costing $150,000, and you've freed up $100,000. Subject to certain requirements, you can sell your home and realize up to $250,000 in tax-free profits if you're single; $500,000 if married.
Another way to tap your home's equity is through borrowing. Your home's equity may be an easily tapped and low-cost source of cash (the interest you pay is generally tax-deductible).
Some retirees also consider what's called a reverse mortgage. Under this arrangement, the lender sends you a monthly check you can spend however you want. Meanwhile, a debt balance (that will be paid off when the property is finally sold) is built up against the property.
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