Home Equity Loan

Is this home equity loan outrageous?

We are being offered a $20,000 bill consolidation loan from CitiBank, at 12% interest. The loan is for 20 years, with a monthly pmt. of $300. I thought that was ridiculous! If it was a $20K car, I'd probably have the same payment but for only 5 years. Twenty years?? Insane! Are all the banks this greedy? Mystic- Don't be so quick to judge girly. I said we were offered the loan -- I didn't say we'd go for it. Read the question next time.

Public Comments

1. You are paying interest only. And that payments sounds about right.. but still.. ridiculous. Lenders are not the ones that make the interest rates.. the Fed is. And they have lowered the interest rates significantly in the past 6 months.
2. The interest rate is too high. At $300 per month you would pay it off in 9.2 years. To repay this loan in 20 years would require payments of $220 per month. Mortgage rates are around $5.6 percent, so a home equity loan should not be a lot higher. You should be able to do much better elsewhere.
3. Why would you want to give them all your money??? 20grand should take only 5 yrs to pay back and your willing to pay it for twenty years??? The bank may be greedy but your a royal dumbass!!!
4. You're right - its a terrible deal.
5. 12%? That's the insane part.
6. That is crazy, are you over the Loan to value percentage. Try Bank of America. there rates are much better, and no costs at all. Dont take this deal!