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So you want to buy a house but already own. These are your options. Many current homeowners would like to sell their home and trade up or down but aren’t sure how in this competitive Real Estate market. If you’re not feeling stuck because of a 2% pandemic era interest rate and resulting payment shock, then it’s probably the daunting task of selling and buying at the same time. Unless you’re one of the lucky few who can afford to purchase a new home without selling, you’re facing a difficult task. Years of strong housing appreciation have created the largest amount of home equity in US history. American homeowners have on average $315,000 in home equity as of Q4 2024 according to Core Logic. The problem most home shoppers face is how to unlock this equity before selling so they can become an attractive non-contingent buyer. Let’s explore the ways. A Home Equity Line of Credit can be a very useful tool when trying to access your homes equity. A HELOC will typically give you access to up to 80% of the equity in your home minus the balance of your existing mortgages. This is a very flexible financial tool. Payments are only due on the balance drawn on the credit line and those payments are typically only for the interest accrued on the loan. No principal payment is required, which keeps the payment low. Very handy when faced with the prospect of owning two homes simultaneously. This is a great option for prospective buyers who can afford the payments on both homes in the short term and who have enough equity available for a down payment on the new home.
