Yahoo Finance The Bidens have refinanced their properties an 'astonishing' 35 times, yielding $6M in cash, the Daily Mail says
President Joe Biden and his wife, Dr. Jill Biden, have long owned some sweet high-end homes in Joe's hometown of Wilmington, Delaware.
Now the Daily Mail claims it has obtained records indicating the Bidens have refinanced their Delaware properties an “astonishing” 35 times, yielding about $6 million in cash over that period.
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“I don't understand why anyone would view their home as an ATM. Constantly pulling money out of your home,” Los Angeles realtor Tony Mariotti told the publication.
However, other experts argue there’s a time and place for tapping into your home equity.
The Biden real estate portfolio
In 1975, before his marriage to Jill, Joe paid $185,000 for a 10,000-square-foot mansion, which once belonged to the DuPonts. He nicknamed it “The Station.”
According to Forbes, the Bidens stayed in the luxury home for 20 years, “using it as something of a savings account,” which is to say, repeatedly refinancing it. He reportedly did so multiple times over the years whenever he needed liquidity (read: cash), before selling it for $1.2 million in 1996 and putting down $350,000 for four acres of lakefront land.
When they’re not residing in the White House, the presidential couple now spend their time at the Wilmington family home — which Joe built on the lakefront land and is now worth between $1 to $2 million.
And in 2017, he splurged on a $2.7-million summer home in Rehoboth Beach, which he’s reportedly borrowed against as well. Forbes points to financial statements that indicate Joe took out $15,000 to $50,000 against a line of credit in 2022, then another $50,000 last year.
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Is refinancing your home a bad thing?
Neither the Daily Mail nor Forbes has reported why exactly the Bidens might have extracted so much equity from their real estate holdings, but there are a few reasons why experts do recommend such tactics for homeowners.
For one, refinancing your property can be a smart move if mortgage rates move down and you’re able to secure a significantly lower rate with smaller monthly payments or shorten the length of your mortgage term.
Since you’ll have to pay 2-5% of the loan amount in closing costs when you refinance your mortgage, you’ll need to calculate whether switching to a new loan will actually save you money. The rule of thumb has generally been to refinance if you can slash your interest rate by at least 2%.
On the other hand, taking out a reverse mortgage or a home equity loan or tapping into your equity though cash-out refinancing can help homeowners gain access to cash when they really need it.
This money can then be used as you see fit, whether that’s to pay off higher-interest debts or fund major home renovation projects to increase the overall value of your home.
That said, there are, of course, situations where it might not make financial sense to tap into our home equity as well.
"It's not a good idea to be tempted to use your home equity for frivolous purchases," Ian Wright, director at Business Financing, told CBS News last year. "Risking your home for the sake of borrowing money for a fancy holiday or upgrading your car is definitely a foolish move."
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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
