How to Avoid Being House Rich and Cash Poor. The term house rich and cash poor means you means housing costs take up most of your income your house takes up 30% or more of household income leaving you with an expensive house but little money for anything else. You may already be in this situation and not realize the term, but know you are financially burdened by your home. There are some alternatives to relieve some of the financial burden.
Home Equity Loan – A home equity loan can be a great solution if you have already built up some equity in your home.
Revisit your Budget – It’s always important to have an annual financial health check up and look at your spending habits and also to review your current mortgage rates compared to lower mortgage rates and see if there would be a savings.
Renewing or refinancing with a mortgage broker with best mortgage rates Alberta – You are not tied to your current lending institution and have the option of changing lenders. If you have a high mortgage rate, this will put additional financial pressure on an already impossibly tight cash management scenario so you may want to consider refinancing or renewing option if you find best mortgage rates.
Downsizing – This may be an option you may not want to look in to, but you may want to find out all your options before making a decision and downsizing could help to relieve the financial burden.
You may be a first time homebuyer and are about to get yourself into that situation but you can avoid it. At Home Loans Alberta we want you to be financially comfortable and whether you are already house rich and cash poor, we can offer seamless solutions to all your mortgage needs. If you are looking to buy a new home, set up a business or even refinance an existing loan or mortgage, we offer you the perfect solution to cater to your specific requirement.