Home Equity Loan to Pay Off Debt
Tap into your home’s equity for financial flexibility
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I own my home outright. Would it be wise to get a home equity loan and pay off my debt?
Due to a bankruptcy 7 years ago, we have 4 loans of high interest (15%). Bankruptcy is off our credit report now and interest rates are getting better. Question is I own my home outright, would it be wise to get a home equity loan and pay these off with the money? All 4 notes will be paid off in around 4 years. It totals to about 30,000 in debts. My Payments run about $1,200.00 per month for the 4 notes (these are vechicles). Thanks so very much.
Home equity is the value between what your home is worth (in a sale, or an estimate of this determined by an appraisal) and the amount you owe on a mortgage(s). If your home is "paid off" or you do not have any mortgage balance remaining, you can certainly 'tap' that value by either refinancing your home, and creating a first mortgage, or by taking out a Home Equity Line of Credit (HELOC).
If you are looking to borrow money to pay off other debts (you mentioned 15% APR), a home loan is almost always your best route, since you get a low rate and the interest is tax deductible. With your old bankruptcy removed from your credit report, you may qualify for a low rate loan, which will keep more of your money in your pocket, and lower your monthly debt payments.
Bills.com makes it easy for you to apply for a loan.
Be sure to shop around and compare options, so that you get the best deal suited for your needs.
Tap into your home’s equity for financial flexibility
How much do you want to borrow?
Checking your options won’t affect your credit