Are you looking for ways to tap into your home equity but want to keep your low-interest, primary mortgage in place? This is a common goal for many homeowners who are sitting on a ton of housing wealth who want to access cash while preserving their assets.
As you research, you’ll likely note that current interest rates are high for many traditional home financing options. While you have likely gained a ton of equity in recent years, the cost to cash-out on some of that may seem intimidating.
However, you may not have to put your financial plans on hold. A shared appreciation mortgage (SAM) may be the key to converting your home equity into funds you can use immediately. Here’s how it works:
A shared appreciation mortgage is a loan (with a lender) or a contract/agreement (with an investor) that allows a homeowner to use their home equity now in a form of cash proceeds in exchange for a portion of their home’s future appreciation. The homeowner repays the amount borrowed + shared appreciation costs when they either 1) sell the home, 2) hit a maturity event, or 3) the duration or term of the agreement ends.
One of the key benefits of a SAM is that there are typically no monthly payments required, nor are there restrictions on how you utilize the funds. And, with term lengths ranging anywhere from 10 to 30 years for some companies, the monthly payment savings increases your potential earning capacity and opportunities for investment. A shared appreciation mortgage gives you the direct advantage of the
time value of money.
Ready to learn more? You can calculate how much you may get with our proprietary shared appreciation mortgage, EquityChoice; or, call us at 1-888-316-3934 to speak directly with a licensed loan officer who can answer any additional questions you may have. We look forward to helping you reach your home equity goals!