Deciding to sell your Arizona home is a big decision. It can have an impact on many aspects of your life in both a good and bad fashion. So it is important to understand your goals for selling and the main reason which is driving you to sell your home. Here are a few reasons why you might be interested in selling and how they will dictate the type of sale that you are interested in.
Capturing Your Equity
If you have been living in the house for a long period of time, most likely you will be able to sell it and not have to pay taxes on the increased value or what is called the capital gain. Having lived in the house for many years your mortgage payment ratio has changed. Early in a mortgage, you are paying mostly interest and only a very small portion of each month’s payment is chipping away at the principle. But the longer you pay on the mortgage, the more that proportion shifts in your favor. Slowly you begin to see more money going toward the principal and less to the interest. This is how you build equity. So when you choose to sell your home and the value has increased, you get to pay off your mortgage and still have money left to keep. That is your capital gain. And if capital gain is earned on a home sale that is an investment property, that money is taxed. But as it is your family home being sold, you do not have to pay tax on that gained value.
Lower Your Monthly Living Expenses
Over the course of your life, there might be times when your income fluctuates. Sometimes it can go up such as is the case with a raise. But other time, it can go down. This could be a result in working fewer hours, changing jobs or the loss of an additional income source. But if the decrease in your income is long-term or permanent then it makes sense to sell your home and find a home with a lower payment or one that you could pay cash for using the proceeds of your current home sale. Not only will it cost less to maintain a smaller home but it will relieve a huge amount of stress knowing that you are not stretching your budget to an extreme.
Long-Term Financial Issues
Selling your home to avoid foreclosure or bankruptcy is a smart option. Financial challenges will only grow if you are trying to make large mortgage payments along with the rest of your bills. Deciding to sell your home and settle your other issues will help to protect your credit and make your financial recovery easier. Knowing what your goals are for the future and why you believe selling your house will help reach those goals will help a real estate professional such a Phoenix Home Buyers Group to market your home in a manner that will best suit your needs. A fast sale, an all cash offer or the option to rent back your home for a short time can make a big difference in how you move forward after the sale.