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Releasing Equity
When reading newspaper in english I sometimes read the expression « releasing equity« , most of the time it is about private persons who have borrowed money against the value of their house.
I didn’t know exactly what it meant but yesterday I met an ozzie guy and he explained the concept to me, let’s say you have a house valued 500 000 AUD, the bank might evaluate its value to 300 000 AUD (they always lower the estimated value in case of a resale), then you can borrow the corresponding sum to the bank, if you cannot pay the money back the bank can seize your house and sell it to get their money back.
This seems to be widely common in the US, Australia and in the UK, but it seems to me like we don’t have such a mecanism in France, unless it is what we call « gager sa maison » (note the similarity with the english word mortgage).
I didn’t ask to the guy but now I am wondering wether you can release equity before you have finished paying off your mortgage, that would be kinda weird, huh ?
