When times are good—the stock market is high and mortgage interest rates are low—some investors consider refinancing or otherwise modifying their mortgage in order to invest in securities. After all, a times-are-good market looks like it will turn that mortgage money into a tidy profit, paying off the mortgage while generating additional income.
Unfortunately, worst case "rainy day" scenarios can happen, and they do happen. Taking out a mortgage for potential financial gain at the possible cost of losing a house is risky and dangerous.
Instead, before cashing out your home equity to buy securities, consider the following: How will the mortgage get paid if investments fail or perform poorly? What other financial sources can I turn to if that worst case scenario occurs?
If those answers prove troublesome, the risk is likely higher than it appears on the surface.
If you believe a broker or dealer has pressured or misled you into making an unwise mortgage-related investment, please call The Law Offices of Jonathan W. Evans & Associates for an investigation and consultation.
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