Home equity line of credit?
What is home equity line of credit?
What are advantages and disadvantage of it???
What are Installment Loans?
Advantage and disadvantage of it??
If I want to pay my credit cards and I own a home should i take a home equit line of credit or Installment loan
Answers:
A home equity line of credit (HELOC) is using your house like a 4-sided credit card. Typically, HELOCs have a variable rate and for the first several years only require that the interest be paid.
An installment loan is a loan with a fixed length and a generally, a fixed interest rate.
Interest from debts secured by your home (either HELOCs or installment loans) can often be deducted on your taxes.
A variable rate loan has the potential for the rate, and payment, to go either up or down.
If you take a HELOC or an installment loan that uses your home as security, you are putting your home at risk for the dinner out you paid for last month. You should not transfer credit card debt to a loan that is secured by your home unless you have cut up the cards and will never use them again.
A home equity line fo credit (HELOC) is like having a credit card, your borrowing the money from the equity in your home... HELOCs are variable's which means the payments fluctuate monthly depending on the daily rate. HELOC's are very popular, it saves you from all the fees you'd aquire if you refinanced your house to cash out. Paying off your debt with your HELOC can save you a lot of money a month. You'd only make one payment and only pay towards one interest rate, thats usually lower than a lot of the pates on your credit cards.
This is a topic that can't be addressed adequately in a short answer. A home equity line of credit (HELOC) is a loan, much like a 2nd mortage on your home, but with a limit that you can draw upon as you wish. The advantage, assuming you have some equity in your home, is that it's pretty easy to obtain, has a relatively low interest rate, and offers flexibility in how you use it. The disadvantage is that you risk your home if you default or miss payments.
An installment loan is usually for a specific purchase, for a specific amount, and has a specific payment schedule. A car loan is a good example. Many banks offer personal installment loans that can be used for a variety of purposes but interest rates can be higher if the loan is unsecured.
You may be interested in this new program for homeowners. It works well with a 30, 20, or 15 year mortgage. I am currently using a HELOC (home equity line of credit) with a new software program that helps build equity fast, and will payoff my home and other loans in less than half the time without refinancing, and without extra payments. It is saving me thousands in interest, and pays off home in less than half the years. Those who take an honest look at all the facts and figures from a reputable source will find that this system truly creates a significant advantage for homeowners.
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