Over time, your home or investment property loan repayments begin to make a difference and you start to build equity in the property.
The growth in equity will be increased if:
You make payments above the minimum monthly requirement or
The market value of your property increases.
This equity (or the proportion of the property’s value that you actually own) can be used to finance other purchases or investments.
The growth in equity will be increased if:
You make payments above the minimum monthly requirement or
The market value of your property increases.
This equity (or the proportion of the property’s value that you actually own) can be used to finance other purchases or investments.
Could a line of credit loan suit you? Here are our top 3 tips to consider
1. Flexibility
Line of credit loans can offer more flexibility than personal loans. They can be used to:
- Finance other investments e.g. the purchase of shares or investment properties
- Ease cashflow problems for your business or resource expansion plans
- Pay for home renovations
- Purchase a new car
- Pay for a holiday
- Provide money for emergencies
Line of credit loans can offer more flexibility than personal loans. They can be used to:
- Finance other investments e.g. the purchase of shares or investment properties
- Ease cashflow problems for your business or resource expansion plans
- Pay for home renovations
- Purchase a new car
- Pay for a holiday
- Provide money for emergencies
2. Interest is only charged on the money you use
With a line of credit loan, you have a fixed limit secured against the equity of your home. However, you are in control over how much you draw down – as long as you keep within the limit. That means, you are only charged interest on the money you use.
With a line of credit loan, you have a fixed limit secured against the equity of your home. However, you are in control over how much you draw down – as long as you keep within the limit. That means, you are only charged interest on the money you use.
3. Are you disciplined?
Any money used from your line of credit loan will need to be paid back and could lengthen the time you need to own your home outright.
So while you could use the money for any reason, it is important to be disciplined with how you use the funds.
Ideally, money from your line of credit home loan should be used for investments so you can use it to build your overall wealth.
Any money used from your line of credit loan will need to be paid back and could lengthen the time you need to own your home outright.
So while you could use the money for any reason, it is important to be disciplined with how you use the funds.
Ideally, money from your line of credit home loan should be used for investments so you can use it to build your overall wealth.
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