Home Equity Strategy Review
Equity is valuable. Before we talk about how to access it, the first question is always why.
Your house has a value. You owe money against it. The difference between those two numbers is basically the equity you have in the home. That does not mean all of it is cash you can take out, but that is the simple idea.
The first question is never which product. It is why. What are we using the money for? What does the new debt look like? How does this fit the rest of your finances?
One Michigan point: a home equity loan, a HELOC or a cash-out refinance leaves your taxable value capped. The law counts a mortgage as a transfer for security, not a change of ownership (MCL 211.27a).
The arithmetic is the easy part. The question that actually decides whether using it is a good idea is what you would use it for. Enter your own figures. Your numbers are not sent unless you choose to send them to Samantha.
equity in the home
Talk through your equity optionsThis is arithmetic on numbers you entered. It is not a quote, an offer, a credit decision or a recommendation, and it does not evaluate your eligibility for any loan program. How much of your equity could actually be borrowed against depends on the program, the property and a full review. Align Lending LLC, NMLS #2041154. Equal Housing Opportunity.
Why you want to use it, before anything about how.
Once the three questions above are answered, look at the reason itself.
The reasons people ask about equity are usually debt consolidation, renovations, a large expense, an investment, or wanting liquidity available. Each of those is a question worth examining rather than a use case we would endorse in advance.
When the reason does not hold up.
Sometimes it is because nobody can explain what the money is for. More often it is because, once we talk it through, the person realizes they are solving a short-term problem by creating a bigger long-term one.
Loan options
A fixed second loan against your home, paid out once, that leaves your first mortgage and its rate in place.
How it worksA revolving line of credit secured by your home. It sits behind your first mortgage instead of replacing it.
How it worksReplaces your mortgage with a larger one and pays you the difference. Closing costs apply to the whole new balance.
How it works
Samantha Shelton has been a licensed loan officer since May 2020 and founded Align Lending in August 2020. Before mortgages she was a stay-at-home mom raising three boys.
In her own words: "I own a mortgage brokerage in Michigan and I help people understand their options before they make one of the biggest financial decisions they are ever going to make."
Recognition includes Hall of AIME, NAMB Broker of the Year, and Woman with Vision, along with her leadership work with AIME.
Align Lending LLC, NMLS #2041154. Samantha Shelton, NMLS 1647301. Licensed in Michigan, Ohio, North Carolina, Florida, Louisiana and Texas.
Read Samantha's storySamantha Shelton is absolutely amazing at helping families with their home loans! If you are in the metro Detroit area and need an expert to help you, whether you’re a first-time homebuyer or need a refinance, I highly recommend Align Lending
Individual experience. Results vary.
Check it yourself
The official pages behind the rules on this page.
If yours is not here, ask it on the call. There are no dumb questions.
Your first mortgage carries on as it is, and the equity keeps building as you pay the loan down. You can come back to it when there is a reason.
There are ways to, yes. A home equity loan is a second loan paid out once. A HELOC is a second line you draw on over time. A cash-out refinance replaces your first mortgage with a larger one. Which one fits depends entirely on what you are trying to do; compare them by your goal.
Sometimes. The card balances become debt secured by your home, usually paid over a longer term, so a missed payment puts the house at risk and a lower rate can still cost more in total. Compare what the cards cost with what the new loan would cost over the years you would carry it, closing costs included, and decide what keeps the cards from filling back up.
Not all of it, and the amount depends on the property, your situation and the approach. That is a conversation, not a formula.
When the new payment would not fit comfortably, or when the loan would outlast what the money bought.
Then say that. Working out whether something is a good idea is most of the conversation.
Align Lending made refinancing my home in Rochester Hills simple and straightforward. I was kept updated throughout the process and felt confident in the option I chose.
Sam is an expert helping choose the right financing options for her clients!
Samantha is so smart and helpful. She answered all my questions and she followed up with me a week later to ensure I had my questions answered again. She is amazing.
I highly recommend Align Lending to anyone looking for a mortgage broker in Southeast Michigan. The team was knowledgeable, responsive, and easy to work with.
Working with Samantha and her team was such a breath of fresh air. They are extremely professional and always go above and beyond every expectation. A true pleasure to work with.
Individual experiences. Results vary.
The reason has to come from what you are trying to accomplish. Doing nothing is a legitimate outcome, not a failure to decide.
Not what product you want. What you are actually trying to accomplish.
Samantha works out what matters most for you specifically.
Your options, the tradeoffs, and your next step. No obligation to go further.
Background from the Align Learn Center, if you want to read before you talk to anybody.
Align Lending LLC, NMLS #2041154. Samantha Shelton, NMLS 1647301. Equal Housing Opportunity. Licensed in Michigan, Ohio, North Carolina, Florida, Louisiana and Texas. This page is for educational purposes only. It is not a credit decision, a preapproval, a commitment to lend, or an offer of credit, and it does not evaluate your eligibility for any loan program.
Your house isn't an ATM. Tell me what the money's for and I'll weigh it with you.
Samantha Shelton · Broker Owner and Senior Loan Originator · NMLS 1647301
Text Samantha
Texts go to Samantha at (248) 506-5727. 7 days a week, evenings included.