Mortgage

What Is Equity And How Can You Use it to Your Advantage | Jabar Post Indonesia

What Is Equity And How Can You Use it to Your Advantage | Jabar Post Indonesia/a> – This time JabarPost.Net will discuss about Mortgage.

The following is What Is Equity And How Can You Use it to Your Advantage. And for those of you who want to find a similar explanation, you can search in the Mortgage category

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What Is Equity And How Can You Use it to Your Advantage | Jabar Post Indonesia

A mortgage loan or, simply, mortgage (/ˈmɔːrɡɪdʒ/) is used either by purchasers of real property to raise funds to buy real estate, or alternatively by existing property owners to raise funds for any purpose, while putting a lien on the property being mortgaged. The loan is “secured” on the borrower’s property through a process known as mortgage origination. This means that a legal mechanism is put into place which allows the lender to take possession and sell the secured property (“foreclosure” or “repossession”) to pay off the loan in the event the borrower defaults on the loan or otherwise fails to abide by its terms. The word mortgage is derived from a Law French term used in Britain in the Middle Ages meaning “death pledge” and refers to the pledge ending (dying) when either the obligation is fulfilled or the property is taken through foreclosure.[1] A mortgage can also be described as “a borrower giving consideration in the form of a collateral for a benefit (loan)”.

Mortgage borrowers can be individuals mortgaging their home or they can be businesses mortgaging commercial property (for example, their own business premises, residential property let to tenants, or an investment portfolio). The lender will typically be a financial institution, such as a bank, credit union or building society, depending on the country concerned, and the loan arrangements can be made either directly or indirectly through intermediaries. Features of mortgage loans such as the size of the loan, maturity of the loan, interest rate, method of paying off the loan, and other characteristics can vary considerably. The lender’s rights over the secured property take priority over the borrower’s other creditors, which means that if the borrower becomes bankrupt or insolvent, the other creditors will only be repaid the debts owed to them from a sale of the secured property if the mortgage lender is repaid in full first.

In many jurisdictions, it is normal for home purchases to be funded by a mortgage loan. Few individuals have enough savings or liquid funds to enable them to purchase property outright. In countries where the demand for home ownership is highest, strong domestic markets for mortgages have developed. Mortgages can either be funded through the banking sector (that is, through short-term deposits) or through the capital markets through a process called “securitization”, which converts pools of mortgages into fungible bonds that can be sold to investors in small denominations.



Equity is everything! It’s a common term but it is important to understand it fully. The definition of equity is basically how much of something you own. In real estate you can think of it of how much of a property you own. if you owe 100k on your mortgage and your home is worth 200k, you have 100k in equity. This is basically your WEALTH. The reason I love real estate is you can grow wealth with very little money starting out, and this is backed by the fact that most American’s wealth is derived from their real estate. Even if you aren’t trying to grow wealth, owning a home naturally will increase your wealth as you pay down the mortgage and the value of your home increase. Both these forces work to your advantage to grow your wealth which you can use to benefit you and your family, and that’s what’s important.

If you have real estate questions leave them in the comments or reach out to me directly and I would love to help!

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Berkshire Hathaway Home Services Fox & Roach Mount Laurel
1025 Briggs Road, Suite 148
Mount Laurel, NJ 0805
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