Home equity is an important term, as far as home mortgages and personal finance is concerned. Basically, home equity is the difference between the amount you owe and the market value of your property. You need to increase your home equity in order to make maximum advantage out of your property. If you want to get more equity in your home in less time, then you will need to adopt a few strategies that have been proven to be extremely successful for years.
The first thing you should take care of is improve the physical condition of your property. Higher assessed value of your property means greater amount of equity in your home. So, the improved your home is, the greater equity it has. You should also keep in mind that some of the home improvement methods add more value to your home than others.
New hardwood flooring, new landscaping and new siding add great value to your property. In addition to that, you can also add an entire new section to your house, a step that will raise your home’s appraised value significantly. While doing little things here and there will also be of help, you should consider a significant remodeling to raise your home equity to a valuable extent.
We all know that money that you owe on the mortgage is one of the major factors that calculate the equity in your home. The less is the amount you owe, the more home equity your property will have. You must understand that even a little effort will go a long way in helping you building greater equity in your home.
Try to pay an extra 10% of your payment every month towards your mortgage and you will be surprised to note the difference. Suppose you decide to pay an extra $100 every month towards your mortgage, you will find that $1200 that you paid at the end of the year has increased your home equity to a significant extent.
If the local tax authorities agree to re-appraise your home, then the equity in your home will surely increase significantly. Thus, by getting more equity in your home, you will be able to tap into it whenever you are in need of funds, but the only drawback is that you will also need to pay more taxes. However, a re-appraisal which raises your home’s value instantly adds to your home equity considerably.