Home equity line of credit, good or bad ?

Answer 1

Good if you dont blow it on something stupid. Good if you want to use it to get out of debt. Bad if you buy material things that dont offer a return on investment.

I took one out on my home to pay off my credit cards, and I made sure to pay it off as soon as I was able. I just sold my condo and as a result, took away a nice profit because I didn't owe anythign on my HELOC.

Answer 2

Be VERY wary of home equity lines of credit. Most people telling you that these loans are good are actually in the business of doing loans.

The tax deductability of mortage debt is great if you are a careful manager of your personal finances, since interest on car loans and credit cards is not tax deductible. However, the reality is that most people use equity lines to pay off credit card debt (or buy luxury items they dont really need) and only get deeper into debt since they charge to the cards again or even borrow more than their house is worth.

More importantly, if you live in a state such as Florida, where your homestead is protected in case of bankruptcy, you are spending equity that otherwise will be shielded from unsecured creditors (credit cards, for example). TALK TO A GOOD ATTORNEY if the reason for your question is financial difficulties.

BE WARY AND CAREFUL. Most of us are unable to properly manage equity lines.

Answer 3

Home equity line of credit can be good for several reasons
1) if you know you will be getting the money to pay it off ( not pay it off) Because lines of credit are just credit cards on your house the payments are based off of just interest. Often they are only fixed for a given period of time. Most likely you want a line of credit because you want to take equity out of the home but would like to avoid certain cost associated with refinancing. This is not a bad idea. Unless Like many people I deal with on a regualr basis. People take out lines of credit until they hit their adjustable and then they refinance the second to lock into a fixed rate. The only difference is they have prolonged the obvious and for whatever period of time they have held this line they have not seen a decrease in the balance. Waste of money! Regardless of your decision feel free to log onto http://www.justgetaloan.net for fast free pre-qualification. Our bank will give you the best possible deal available. Also you can contact me at 866 530 7300 or by email [e-mail]

Answer 4

It depends on your need. It's good that you have the option to borrow money. It's bad if the interest rate is adjustable and high and if you don't plan to pay back soon. If you know the amount you need to borrow, also consider the fixed rate home equity loan, which gives you cash upfront and payment schedule. I ended up refinancing the whole mortgage after considering all options because the rate and monthly payment were the lowest doing so.

Answer 5

depends on the rate and how you use it.

If you can get a decent rate, its usually worth it because the interest is tax deductable. Use it to pay off high interest debts like credit cards - then DONT use those cards any more. Or use it for home improvements, which increases your equity.

Answer 6

If you manage it properly, home equity credit is considered good debt. The reason is that, unlike regular credit card consumer debt, a portion of the interest can be written off in taxes, thereby reducing your taxable income.

Answer 7

Has its effective time to be used but your question leaves no details to compare. Based on therlimited information provided I will say bad rather than give a thumbs up on a situation I am not aware of.

Here is some additional info. Hope this helps.

Answer 8

Thx for the answers everyone xx

Answer 9

Not sure what to say