On Your Side: Home Market Advantage

You don't have to abandon your home to take advantage of rising home values. Shad Marshall, a lender with Highlands Residential Mortgage, helped Steve Noviello find four ways to cash in on the hot market.

1. Save by getting rid of private mortgage insurance. You can also ask your lender to take it off at 20 percent equity (an appraisal is often required.)

2. Take out a home equity line of credit or cash out re-fi. As home values rise, you can borrow against your house even if you haven't paid much of the mortgage. You can typically borrow 80 percent of your home value minus the current mortgage. For example, if you bought your home years ago at $140,000 and now you've paid the mortgage down to $120,000, your home may be worth $200,000. That means you could take $40,000 in cash out of it.

3. Consolidate your debt. The same kinds of equity loans can really save money on interest over time if you pay down credit card debt. A home equity loan is often 4 to 5 percent versus credit cards with interest twice that or much more.

4. Upgrade. Increased equity in your existing home allows you to sell that house and put a larger down payment on perhaps a nicer home.

LINK: highlandsmortgage.com

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