When your home’s value increases by over $50,000 in 2021 alone- you take notice! The average homeowner has access to well over $150,000 in tappable home equity while still maintaining 20% equity in their homes. But just because you can cash out, does that mean you should? As you’ve witnessed your home equity continue to balloon, you might be tempted to do something with those newly discovered funds. You might start getting the itch to finally spend some of that ‘hard earned money’ on a boat or maybe even a lavish vacation. Or maybe you’re more of a money nerd and you just hate seeing that equity sitting there underutilized- doesn’t it just feel like a waste with those funds sitting around doing virtually nothing? Either way, you might be facing a money decision with five zeros after it, and we want to help you think about it well.
As a bonus, we just wrote a great post on Is a house a good investment? In some ways it is, but in many ways it’s not!
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Hi Joel and Matt. I listened to the episode today and wanted to share my story on my cash out refi. I bought my house in Sept 2020 in Phoenix, AZ and we refinanced a year later in Aug 2021. We gained about 160k equity in our house after only 11 months we were able to drop our PMI and take up to 60k in cash and our interest rate stayed the SAME!!! We only took out 40k because we didn’t want to take our more than we needed. Just wanted To share a positive story with you all. I love the show so much!
Hey Morgan. Thanks for sharing. Pretty incredible that your home gained so much value in so little time! Sounds like you made a smart move with your cash-out refi – and back when rates were incredibly low too!