The Power of Equity


“It has been my experience that competency in mathematics, both in numerical manipulations and in understanding its conceptual foundations, enhances a person’s ability to handle the more ambiguous and qualitative relationships that dominate our day-to-day financial decision-making” -Alan Greenspan

Equity is an extremely useful tool that is often overlooked when investing. Equity is stored money. For example, in real estate, whether ou own home or a real estate investment, equity is the measure of how much your home is worth minus what you still owe on the house.

If your property is valued at $200,000 dollars and you only owe $60,000, then you have equity of $140,000 dollars. This money is available to your through home equity loans. Each year your property appreciates which increases the value of your home but not what you own on the home. Therefore, every year you receive more and more equity.

There are a number of people who suffer financially never realizing that they have a great deal of money just sitting in t heir own home. With a home equity loan your financial problems can easily be put to rest.

A home is just a savings account and each month you pay money to your home. This money sits and when you need it you can draw money out of your house just like a normal savings account. This money can be used in any way you would like – vacations, paying down debt, medical bills, and college tuition.

Equity lines of credit are offered by banks, mortgage companies, and lenders as way to get money from the equity in your home. A home equity loan actually has different interest rates associated with it then normal loans.

Unlike other loans which require you each month to pay money on both interest and principle, a home equity loan allows you to pay interest only. This type of loan is very easy to get and you can receive either a big check or a line of credit you can access when you need too. This is a great loan option, especially if you are interested but just do not have the capital to start.

Interest only payments means that you can pay just $70 dollars a month on a loan of $20,000. If you take a look at your expenses most people pay more for their phone or cable bills and they receive no money in return.

If you are interested in how much equity you have in your home contact a financial advisor or real estate agent who can help you figure out how much money you have saved away.

Visit the Global Investment Institute and signup for our free Investing For Beginners [] E-Course at []

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Author: Piyawut Sutthiruk

Welcome to Thailand, the land of smiles, beautiful sights, delicious foods and the friendliest people in the world.

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