Homeowners who have 8+ years of mortgage payoff will be shocked to learn how much equity they built
Channel: Nick McLean Real Estate Group
Date: 2022-03-22

How long does the average homeowner live in their current home and how much have they paid down their mortgage over that time? By using amortization schedule tools we can discover just how much equity you have in your home.

According to the National Association of Realtors, the average homeowner stays in their home for about eight years. Only 36% of people stay in their homes for one to five years. 

This video will show you how much you have paid down your mortgage over the last eight years using an amortization schedule based on a mortgage of $400,000.  

There are several free amortization schedule calculators that you can find online.
For the example today we will use a $400,000 mortgage, with 30-year payoff terms.

With an amortization schedule, you can see exactly how much of your payment is going to the interest for the loan and how much is going towards paying off the principal.

After 3 years you have paid down your principal $21,000
After 4 years you have paid down your principal $28,000
After 5 years you have paid down your principal $36,000
After 8 years you have paid down your principal $52,000

This means that after 8 years you have paid off $52,000 but that isn't the entire story. It doesn't take into account the appreciation that may have occurred in the last 8 years. Last year alone the home prices went up 22%. That would make the home worth $84,000 more than the owner paid for it. If you add the $84,000 to the $52,000 from your loan payoff you get $136,000 in equity in just eight years! That is why homeownership is such a powerful tool when building wealth.

Using the online amortization schedule tools will give you an idea of what you have paid off on your mortgage but to get the entire picture of the equity in your home you need to know what your home is worth in today's market.

To get an accurate valuation of your home give Nick a call at 509-255-8070 or go to NickMcLeanRealEstate.com to receive a no-obligation home valuation.

If you have owned your home for 5-15 years you might be shocked to learn just how much equity you may have in your home.


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Nick McLean Real Estate Group