According to S&P CoreLogic Case-Shiller Indices, there has been an increase of 5% in the prices of residential property in the US last year, despite prices falling in markets in the West Coast and cities like Chicago and Boston. You’ll obviously benefit from the increasing prices if you’re planning to sell your house, but even if you’re not, there’s good news for you. Here’s two ways in which you can benefit from rising house prices.
Dropping mortgage insurance
Your home’s value is directly proportional to your equity. Calculate your equity keeping this in mind. If it is at least 20 percent of the original price, you would not have to pay for mortgage insurance anymore. Example: on a $300,000 home, that could be a savings of about $3,000 a year, or $250 a month.
Tapping more home equity
If the equity has gone significantly up, you can figure out options through which you can borrow more money than you did in the past. This is an inexpensive way to financing a home improvement project. You would be able to borrow small amounts over time to keep your interest payments lower. You can also opt of longer repayment periods (30 years) to pay less money per month.
So if you’re planning on selling your house, this is the right time to do it. If you are looking for some great purchase rates, visit www.aboutyourmortgage.com. And if you’re not, consider dropping your mortgage insurance or borrowing based on your equity to make the most out of rising house prices. Stay tuned for more information on home loan refinance mortgage and other real estate related info.