Tips For Paying Off Your Home Equity Loan Under COVID-19
With coronavirus cases seemingly on an endless rise worldwide, it can become discouraging to think about how much more of the pandemic we must endure, and the subsequent effects the struggling economy may continue to have on the livelihoods of the workforce. While medical professionals remain on a constant race for a cure, with recent industry breaking news headlines of the first FDA approval for a potential treatment, it is important to remain optimistic and cognizant of what you can control.
Apart from the obvious importance of wearing masks and practising social distancing, in regards to your personal home finances, there are a variety of proactive measures you can take action on. Below are our favourite tips to ensure you’ll be able to continue to balance a comfortable lifestyle, financially, while making payments to retire your home equity loan.
There’s No Need To Rush!
It can be stressful to think about your home equity loan repayment plan and upcoming payments dates, which can make it even easier to want to jump ahead of payments whenever you’re able to, to alleviate any financial stress. Despite the presumed benefits of retiring any sort of loan as soon as possible, there are, in fact, numerous benefits to not doing so as well, especially provided the current economic climate.
With the current volatility of the markets, withholding from advanced payments can serve to be drastically beneficial; notably, in times of crisis. Paying more than necessary, especially during a global pandemic, is risky. With the instability of the economy, and thousands of workers furloughed or laid off, there is no need to unnecessarily dilute your personal equity, as you never know when you may be in dire need of capital.
Again, this does not mean we discourage advanced payments. We are simply advocating for consideration of alternative options, while highlighting the strenuous circumstances of the current economic state.
Budget, Budget, Budget!
Budgeting does not come naturally to everyone, but it can be the cornerstone of a sound financial plan for your future.
If you don’t yet have a budget to monitor your monthly expenses, we recommend setting aside a weekend with the members of your household to establish a sound budget. Notably, in regards to the current pandemic, not only will a budget allow you to better visualize your current financial state, but allow you to better save for necessities such as an emergency fund, as well as detail a specific payment plan for your existing home equity loan.
We at Leap Financial want to ensure that you are able to exit these difficult times more prosperous than you were when you entered.