A lot of folks are visiting my office during the first months of the year. Many have run into cash-flow problems based on credit card debt after the year-end Christmas spending. Credit card balances have accrued and only making minimum payments is not a long-term strategy to pay off the credit cards, which carry a high interest.
We also receive many inquiries from self-employed clients, who are receiving a significant income tax bill in the Spring by the CRA (Canada Revenue Agency) for outstanding taxes. Some of these clients did not plan for the accrual of funds for the purpose of outstanding tax payment and are finding themselves in a cash-flow problem.
And finally, we have helped clients who wanted to buy an investment home to take equity out of their prime residence, which value had increased significantly.
By means of an equity take out for any of the above examples, we have helped our clients to tap into their existing equity for debt consolidation and paying off their income tax bill, thus increasing their personal cash-flow and taking care of the burden of looming debt, while using their collateral of their homes to significantly reduce the cost of credit.
We have shown many of our clients how to create an additional income stream for themselves and their families by purchasing investment properties for rental.
Equity Take Out when understood well and planned for, can be the perfect strategy to increase your personal wealth.