Drop Your Mortgage Insurance 

If carrying mortgage insurance was an initial requirement when you purchased your home, now is the time to check in and see what your current situation is. Usually, when your down payment is less than 20% of your home’s value at the time of purchase, you need to have mortgage insurance—until you’ve built up enough equity, that is. 

Depending on how your home’s value has risen, you might have reached the point where you can ditch your mortgage insurance a bit quicker than you thought. You will have to apply for a PMI-canceling refinance and pay for an appraisal to prove your home’s value has increased. But it’s worth checking where you stand to see if you can save yourself that extra payment each month, and have more to put towards other expenses. 

Take Out a HELOC

Use the equity in your home to increase its value even further with a home equity line of credit (HELOC) for a remodel, renovation or addition. Of course, you can use a HELOC for just about anything you can imagine: paying for college bills, consolidating debt, taking care of major business expenses or covering wedding costs. However, this type of loan is most often used to put money back into your home, growing your investment even more. 

This route is particularly helpful because, as you’re essentially borrowing against your home’s value, you can also use the HELOC like a credit card, taking out small amounts as you need them. 

Refinance for a Lower Rate (or payment)

You have a few options when it comes to refinancing. You can refinance for a lower interest rate, or for a lower monthly payment, or you can aim for both. Right now, interest rates have risen a bit, but depending on when you bought your home, they might still have dropped from what you paid. If you’ve reached the adjustable period in an adjustable rate mortgage, you might want to refinance to get a fixed rate loan. And if your credit has gone up since you took out your mortgage, you might now qualify for a lower interest rate. 

As home values have risen, so has your equity. But there’s no guarantee of the future, so it makes sense to take advantage of the increases in home prices sooner rather than later. 

When you’re ready to make the most out of your home’s equity, RMCU can help you out with expert guidance and a professional mortgage team that knows all the ins and outs of financing. Get in touch with one of our real estate loan officers to find out how your home equity can work harder for you.