Reported by Bahiyah Shabazz, MBA
The interest rates are slowly lowering, the desire in purchasing homes is slowly increasing. Many people are using the down [bear] market as a buyer’s dream. I’ve heard many current homeowners even promise to refinance to take advantage of the lower interest rate. Before, you sign your name on the dotted line make sure this is advantageous to your situation.
The American dream is to become a homeowner, own a car and work in your desired field. The American nightmare is to have debt number higher than your elementary school teacher taught you to count. Your house is a place to establish memories and be comfortable.
You should not use your home as a ‘cash cow’. Once upon a time, bankers would coerce their clients to take advantage of the “free money” to consolidate debt, vacation or use as an emergency fund. The interest would simply be a tax deduction. Since the market is down, that’s not such a good idea. I believe one of the reasons why we are in such turmoil is because we used our homes like an ATM machine. Anytime we felt the need to purchase we would use our home.
Home Equity Lines of Credit (HELOC) made spending so easy with an assigned book of checks and a debit card. Homeowners treated their homes like dispensable checking accounts. This was a learned lesson.
If you decide to purchase a home or refinance for a lower interest rate do not use the equity as a means to your needs. Enjoy the fact that you have room to breath and your house isn’t upside down in value. If you want to vacation or establish an emergency fund , then open a savings.
“Love Yourself Enough To Support Yourself.”
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