Home Equity Loan

Should I get a Home Equity Line of Credit?

I am buying a home. The mortgage broker tells me I can get a HELOC with zero closing costs in addition to the mortgage. I don't need it currently, but is it useful to get it for the future in case I need money? I am financially stable and have very good credit.

Public Comments

1. Apply for one if and when you need it.
2. NO, because your turning your little equity into more mortgage and financing! Dont spend money you dont have. if you want to buy something, save for it and get it. Too many Americans are financing everything and then are broke.
3. So, why do you want it? You are better off without it unless you are doing repairs on your house/ remodeling (and you need the $$$).
4. sorry but i can't help. but good luck!
5. It probably would not be a bad idea to obtain. You will want to ask though what is the early cancellation fee, what is the interest rate and what is the what is the annual fee. Most of these come with the annual fee waived for the first year and a discounted initial interest rate. Make sure you ask about these as well. Also, read the final paperwork on the closing paperwork for the HELOC to make sure it is consistent with what he is telling you. HELOC's are very nice to have, even if you are in great financial shape currently. The mortgage interest on them is generally all tax deductible and they can provide for a great way to purchase needed items at a lower rate than using a credit card generally. You only pay on what you use and if you never use it you don't pay on it. It seems to work out that when people have the equity in their home and their financial situation is going well that they don't need the HELOC, but if things go bad and you need a HELOC you might not be able to get one because you are either over extended, your credit scores dropped or something similar. Therefore, it is a nice item to have and that way you have instant access to the equity in your home should you need it.
6. No, don't take out more credit than you need. You can get an equity line of credit later. All your debt is reflected in your credit report, and there is little point in having a line that you are not planning to use.
7. It's convenient but carries a higher rate than just a regular Home Equity Loan. Use that when you actually need the money. If you have sufficient emergency funds (4 to 6 months take home pay), there's no real reason to get a HELOC.