Why Liquidity Matters During Transition
Leaving a steady paycheck requires a financial runway. Most people have significant wealth trapped in their home equity. Accessing this capital before you leave your job is a critical strategic move.
Bridge the Income Gap
Create a cash buffer to cover living expenses while your new business or investment ramps up.
Lower Cost of Capital
Mortgage debt is often the cheapest money available. Use it instead of high-interest credit cards or personal loans.
Debt Consolidation
Eliminate high-interest consumer debt to lower your monthly burn rate and extend your runway.
The Golden Rule
"Secure your financing while you still have the W-2 pay stub. Banks lend to income, not just assets. Once you quit, your borrowing power drops significantly."
— Kingdom Collective Advisory
Option 1: Cash-Out Refinance
Best for: Long-term capital, debt consolidation, and locking in fixed rates.
How It Works
You replace your existing mortgage with a new, larger loan. The difference between the two loans is paid to you in tax-free cash. You then make monthly payments on the new total amount.
Pros & Cons
Lower Interest Rates: Typically lower than HELOCs or personal loans.
Stable Payments: Fixed rates mean your payment never changes.
Closing Costs: Can be 2-5% of the loan amount.
Rate Reset: You lose your current mortgage rate if it was lower.
Estimate Your Liquidity
Most lenders allow you to borrow up to 80% of your home's value, minus your current mortgage balance. Use this tool to see how much cash you could potentially unlock.
Potential Cash Available
Based on 80% Loan-to-Value (LTV) ratio. Actual amount depends on credit score, income, and lender requirements.
Option 2: HELOC (Home Equity Line of Credit)
Best for: Flexibility, emergency funds, and short-term needs.
How It Works
A HELOC works like a credit card secured by your home. You are approved for a limit, but you only pay interest on what you actually use. You can draw funds, pay them back, and draw again during the "draw period" (usually 10 years).
Pros & Cons
Flexibility: Only borrow what you need, when you need it.
Keep Your Rate: You don't have to touch your primary mortgage rate.
Variable Rates: Payments can increase if market rates go up.
Discipline Required: Easy access to funds can lead to overspending.
Liquidity Readiness Checklist
Prepare these documents before applying to speed up your approval.
Income & Employment
- ✓Last 2 years of W-2s
- ✓Most recent 30 days of pay stubs
- ✓Last 2 years of tax returns (1040s)
Assets & Property
- ✓Most recent mortgage statement
- ✓Homeowners insurance declaration page
- ✓2 months of bank statements (all pages)
Ready to Unlock Your Capital?
Don't navigate this alone. Our strategic partners can help you evaluate your home equity options and structure the right liquidity solution for your exit plan.
*Disclaimer: Kingdom Collective Group does not provide tax or legal advice. Consult with your tax professional regarding deductibility of interest.