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Five Ways Your Home Mortgage Can Help You Meet Your Financial Goals

National consumer advocate and mortgage expert Dale Vermillion says that in order to secure their financial futures, homeowners should consider using their biggest asset as an investment tool.

“Your home is one of the greatest tools that you can use to accomplish the five financial goals that most consumers have,” he said. “And it begins with payment reduction.”

Vermillion isn’t speaking only about reducing your monthly mortgage payment, though—but rather reducing your overall monthly payments and saving money over a longer period of time as well.

1. Reduce Payment & Free Up More Cash

Most consumers think that the only thing that matters about a home loan is the interest rate. However, there are other issues that should be taken into consideration. The need to have more cash each month and each year is an important one, but interest rate only plays a small role in that desire.

Freeing up cash by paying off high interest credit cards, student loans, or even medical bills is certainly a huge part of the bigger picture, and your home’s equity can help you do just that when you refinance and utilize the correct mortgage loan for your needs. Everyone wants to have extra money in their pocket each month, and eliminating these other bills can certainly help you do that—with some assistance from your equity.

“I’m not saying that interest rate isn’t important,” Vermillion said. “I’m saying that there are other things that are just as important—or maybe even more important.”

He said these are the items we must not overlook—or else we just won’t be getting the benefits our of our homes that they should be providing us.

2. Reap the Tax Benefits

Homeowners can itemize their deductions on their tax returns, and many find that owning a home can give them a great tax break. Mortgage interest is deductible in many cases, so this alone could save a homeowner thousands of dollars per year. This is a consideration that many homeowners who are looking to refinance often overlook—yet it is certainly a benefit of home ownership that should be considered when choosing a refinance loan product.

3. Retirement

Whether retirement is seemingly a lifetime away or a few years away, all consumers want to feel like they’ll be taken care of in their golden years.

“Your home can help you get money so that you can retire at the age you want to with a retirement fund that will help you to live the life you want,” said Vermillion. Strategically using your home as a wonderful investment tool that can lead you to a comfortable and secure retirement so that you can spend time doing the things you enjoy doing, like spending time with your family and traveling.

4. College Education

Whether you’ve got your own student loans to pay off or you want to start a fund to help your children pay for their college tuition, the earlier you start financially planning for it, the better. Student loan debt is a real burden that can last decades or longer, depending on the degree and field of education.

Using your home as an investment tool means that you can pay off college loans or start college funds for your youngest family members without breaking the bank and taking out extra debt at sky-high interest rates. Using your mortgage, you can help to pay off college loans or finance a college education at the same interest rate as your mortgage, which is often lower than federal student loan rates, which can reach as high as 8%.

5. Build Emergency Cash Reserves

Protecting your family is, of course, perhaps your most urgent need. Have you considered what would happen if you were to lose your source of income tomorrow? Would you be financially prepared to pay your bills and live your lifestyle while you looked for new work?

Experts recommend that a family has a minimum of six months worth of expenses in an emergency cash reserve account to protect them in case of a financial catastrophe. For many families, this can total $20,000 or more. If you don’t have that kind of cash available to you, don’t worry: your equity can help you to achieve just that.

Got Questions? We’ve Got Answers.

NLC Loans’ personal mortgage advisors are available to speak with you about the many ways your home can help you to reach all of your financial goals. We’re available toll-free at 1-877-480-8050 or you can reach out to us online.