When it comes to owning their own homes, Millennials won’t hesitate to tap into that home equity.
In fact, millennials aged 30 to 34 are twice as likely to take out home Equity Loans compared to older baby boomer home owners between the ages of 55 to 64.
According to a survey commissioned by Discover Home Equity Loans, 64 percent of older millennials aged 30 to 34 own homes. And 51 percent of those homeowners have taken out home equity loans.
In comparison, just 26 percent of Baby Boomers who own their own homes have used home equity loans.
Homeowners may use their home equity as a means of paying down debt, updating their home or paying for a major expense, explains TJ Freeborn, director of operations strategy for Discover Home Equity Loans.
“Home equity loans are a viable option homeowners may want to consider, especially because they offer perks like a fixed rate for the life of the loan and the potential for the interest to be tax deductible,” Freeborn says.
And it’s an option more millennials than baby boomers seem willing to consider. Millennials also are more likely to view their homes as a “financial asset” or “investment property” compared to older baby boomers…
- 27 percent of millennials are more likely to use their home as a financial asset by selling it to make money compared with 13 percent of baby boomers.
- A quarter of millennials see their home as investment property but only 7 percent baby boomers feel that way.
And when it comes to emergencies, millennials also are tapping their homes for cash: 42 percent of millennials, compared to just 14 percent of baby boomers, are more likely to use home equity loans for emergency cash.
Regardless of age, home remodeling (45 percent) is the top reason for a home equity loan followed by debt consolidation (36 percent).
Not surprisingly, millennials and baby boomers assess the values of their homes in different ways as well. Millennials are more likely turn to friends or family (39 percent compared with 16 percent of boomers) or a ask a financial adviser (38 percent compared with 10 percent of baby boomers) when assessing the value of a home.
Millennials also are more likely to go online to use a bank, financial or real estate website to research a home’s value. Thirty-four percent of millennials use this method, compared to 25 percent for baby boomers.
But boomers are more likely to seek advice from a Realtor when assessing a home’s value, 48 percent of boomers compared with 37 percent of millennials.
Millennials concerned with managing debt burdens can turn to Debt.com for resources and advice including free calculators and budgeting tools for mapping your way out of debt.
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