Unlocking Your Home’s Potential: Using Home Equity for Your Next Property Investment

Posted by Spring EQ on Jul 1, 2025 11:06:15 AM

Your home isn’t just a place to live. It’s your safe space. A place full of dreams and memories. But did you realize it’s also a valuable financial asset that can help you achieve your real estate goals? If you’ve been thinking about purchasing a second home or investment property, the equity you’ve built in your primary residence could be the key to making it happen.

What is Home Equity?

Home equity is the difference between your home’s current market value and the amount you still owe on your mortgage. As you pay down your mortgage and your property value appreciates, your equity grows. This equity represents real wealth that you can potentially access to fund other investments.

 

How to Use Your Equity for Property Purchases

When it comes to tapping into your equity for a down payment on a second property, you have options.

 

  • Home Equity Line of Credit (HELOC): This revolving line of credit allows you to borrow against your equity as needed, paying interest only on what you use. HELOCs typically offer variable interest rates and flexible repayment terms.
  • Home Equity Loan (HELOAN): This option provides a lump sum with a fixed interest rate and predictable monthly payments over a set term.
  • Cash-Out Refinance: This involves refinancing your existing mortgage for more than you owe and taking the difference in cash. This is a good option when interest rates are favorable. Many homeowners took advantage of historically low rates between 2020 and 2022. As rates have increased, HELOCs and HELOANs have become much more popular.

 

Benefits of Using Your Equity

Using home equity for property investment offers several advantages. For starters, it gives you the access to substantial funds without liquidating other investments or draining your cash reserves. The interest on home equity loans may also be tax-deductible when used for investment purposes, though you should always consult with a tax professional for specific guidance.

 

Additionally, this approach allows you to leverage your existing real estate investment to build a larger portfolio, potentially accelerating your wealth-building journey.

 

Moving Forward

If you're ready to explore how your home equity can work for you, Spring EQ can help. We offer a variety of flexible solutions tailored to your specific needs. On top of that, our dedicated team will work with you every step of the way. Want to see how much you qualify for? 

 

 

Please Note: Spring EQ does not provide tax, legal, investment or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, investment or accounting advice. You should consult your own tax, legal, investment and accounting advisors before engaging in any transaction.

 

Topics: refinance, HELOC, debt consolidation, Fixed-Rate HELOC

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    This site is not authorized by the New York State Department of Financial Services.  No mortgage solicitation activity or loan applications for properties located in the State of New York can be facilitated through this site.

    Spring EQ customers get their cash on average in 21 business days, and as fast as 14 days. This average time is measured from the time we receive all requested documents and assumes your stated income, property and title information provided in your loan application matches your documents and any supporting information collected. The time period calculation to get cash is based on the average funding turn times over the first four months of 2023, assumes the funds are wired, excludes weekends and excludes the government mandated disclosure waiting period. Typical applicants are required to provide a current and valid completed application, proof of income, mortgage statement, home hazard insurance, and a photo ID.

    Please Note: Spring EQ does not provide tax, legal, investment or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, investment or accounting advice. You should consult your own tax, legal, investment and accounting advisors before engaging in any transaction.

    Applicants are typically not required to provide proof of assets, and proof of income may be more extensive for self-employed borrowers. Quarterly, we calculate The Spring EQ Cash-In-Pocket Index™ which is the average reduction of our customers debt payments where at least one debt was paid off with loan proceeds. The most recent Cash-In-Pocket Index™ reported a reduction in debt payments of $530.

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    All borrowers will be required to meet Spring EQ's current underwriting guidelines including verification of applicant’s credit profile, debt-to-income ratio, and home’s current value. Eligible Home Equity Loan borrowers must have a FICO score of 640 and meet all other qualifying criteria in Spring EQ's current underwriting guidelines. Refinance transactions may increase total finance charges over the life of the loan. Speak to a loan officer for details. Eligible Home Equity Line of Credit borrowers must have a minimum FICO score of 640 and meet all other qualifying criteria in Spring EQ's current underwriting guidelines. Spring EQ offers Home Equity loan options up to 90% of primary residence value for qualified borrowers (and up to 80% for second home or investment properties).

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