New Orleans Condos, Building equity in your Condo
February 6th, 2008 categories: Condo Knowledge, Julie's Mortgage Tips
Whether you buy a condo in the New Orleans Warehouse District or in Metairie and if you are getting a loan you will begin to pay off that loan the first month that you are the owner. One thing most people forget is that they building equity as they pay down the loan which is the principal. Borrowing 200k at 6%, your note without taxes is $1200. You begin by paying about $200 towards your principal and $1000 on interest. At the end of year one your equity is $2400. You still owe the bank $197,600 and its getting lower in year two. In year two your payments contribute about $215 monthly towards the principal of your loan. Your principal decreases monthly by a larger and larger amount.
So at the end of two years you have about $4980 in equity. This is your equity that builds over time. You can also pay extra towards your principal if you want to lower it even more. I will do another blog on the tax benefits of owning. This is one of the benefits of owning your New Orleans Condo. In four years your equity easily adds up to more than $10,000. People always forget this factor but now you know.
Aquarium of the Americas in the New Orleans Warehouse District
