3 Main Considerations When Deciding Between Equity Sharing Agreement vs. Selling Property Outright vs. Getting a Home Equity Loan
1. What are your long-term goals?
2. What is the current market value of your property?
3. How much equity do you have in your home?
If you're thinking about selling your home, you may be wondering what the best option is for you. Should you sell outright, enter into an equity sharing agreement, or get a home equity loan? Let's take a look at the pros and cons of each option to help you make the best decision for your situation.
-You will receive the full market value of your home.
-You will have no further financial obligations to the property.
-You can use the proceeds from the sale to buy a new home, invest in another property, or for any other purpose.
-It can take time to find a buyer who is willing to pay the full asking price.
-You may have to make repairs or updates to the property in order to sell it.
-You will need to find a new place to live once the sale is complete.
Equity Sharing Agreement
-You can sell your home without having to find a new place to live.
-You can stay in your home for as long as you like.
-You will receive a portion of the profits when the property is sold.
-You will need to find a qualified buyer who is willing to enter into an equity sharing agreement.
-You will give up a portion of the profits from the sale of the property.
-You may need to make repairs or updates to the property in order to sell it.
Home Equity Loan
-You can borrow against the equity in your home and receive a lump sum of cash.
-You can use the money from a home equity loan for any purpose.
-The interest on a home equity loan may be tax deductible.
-You will need to make monthly payments on the loan, plus interest.
-You will accrue more debt by taking out a home equity loan.
-If you default on the loan, you could lose your home.