Home Equity Loan
Is it ok to get Home Equity Credit?
My wife and I bought our home in july 07 for 199k.our home is valued at about 230k.we have good credit but we have about 14k in revolving cc debt and about 6-700 in monthly payments for this debt.i want to consolidate these debts and not use our cc; but also do some home improvements this summer.is it ok to take out a heloc? thanx everyone.
Public Comments
- I wouldn't. You are already at 86% loan-to-value in a falling real estate market. Pay off the cc debt first and defer home improvements.
- I wouldn't necessarily borrow more than what you owe in debt because of the current market situation. But, I don't think there's anything wrong with consolidating your cc debt. You'll get a much lower interest rate, making your monthly payment significantly less and allowing you to pay extra to lower the principle. I will advise only take out a HELOC if you plan on being in your home for at least 5 years, so that by the time you sell the market has had a chance to rebound.
- the answer engineer gave u is a good one except he didnt take into account the difference in interest rates on the cc vs a home equity line of credit. heloc, the answer to your question is this is a good course of action if and only if u can take the interest deduction on your taxes one, and very important TWO IF U R WILLING AND WILL MAKE THE 700 A MONTH PAYMENT ON THE HELOC TO GET THE HELOC PAID OFF IN RECORD TIME, THEN IT MAKES SENSE BECAUSE OF THE INTEREST SAVINGS, MOST FOLKS SAY YES THEY WILL AND THEN THEY DONT, DONT FALL INTO THAT TRAP, BUT UNDER THOSE CIRCUMSTANCES IT IS A GOOD IDEA, go to a local bank and dont pay any or much in closing costsif u add closing costs through a broker with this it probably wont be much of a savings. gl
- Yes it a great idea. I would say make sure you setup a new spending plan though so you will not be tempted to use a credit card again. Also if your planning to sell your home in the near future (< 3 years) consider the housing market. It will return in time but it could cost you in the end if your selling in that time frame
- Depending on how long you plan to stay in the house. Perhaps a Home Equity Loan with a fixed interest rate would work better for you. I'd be afraid at this time of the fluctuating interest rates with a HELOC. Also, you might want to put off any truly unnecessary home improvements.
