Home And Garden Articles

Should I Take Out A Home Equity Loan To Consolidate Credit Cards?

If you?re like most Americans, you have some sort of credit card debt. If you?re paying upwards of 10% and even 20% on those credit cards, then chances are you aren?t making much headway when it comes to paying them off.

Turn on any TV or pick up any newspaper and you?ll find the home equity loan or HELOC (home equity line of credit) market is directly targeting consumers strapped with high-interest credit card debt.

The upside? Most home equity loans or HELOC?s run between 7% and 9%, a much better rate than the 18% to 21% of store credit cards. This alone could save a consumer hundreds to thousands of dollars over the life of a balance. Up to $100,000 of home equity loan interest payments are tax-deductible. Minimum payments are usually lower, and principal is paid down much faster.

The downside? Your debt is now tied to your home. If you default on the home equity loan or HELOC, you could lose your house. For anyone with even a slight tendency towards undisciplined use of credit cards, consolidation through home equity may be disastrous. There are usually closing costs associated with these types of second mortgages, so don?t forget to subtract those amounts from any interest saved.

Before you make a final decision, consider the following factors.

How much will you actually save on interest? There are a multitude of financial calculators on the internet to help you determine what you will pay in interest over the lifetime of a credit card balance. Compare this to what you will pay with a HELOC or home equity loan. Don?t forget to factor in closing costs such as loan application fees, appraiser fees, mortgage filing taxes, etc.

How much do you owe? The general rule is to consolidate at $10,000 or more, but simply transfer to cards with lower fixed rates if your balance is less. If you have reasonable credit, you can usually find credit cards with lower fixed rates and transfer your balances. Even if you have to re-apply for new cards every nine months to a year, it will be worth the effort.

What caused your credit card debt to begin with? If it was a one-time expense such as college tuition, medical emergency, job loss or wedding?and you?re generally good about living within your means?then debt consolidation is probably an excellent option.

If your credit card debt stems from trips to the mall, a big-screen TV, a cruise and lots of other stuff you don?t even remember, then chances are consolidation is NOT a good option for you. Regardless of your balance, you?ll be better served transferring balances to lower-rate cards.

Regardless of what you decide, make sure to read the fine print on all home equity or credit card offers. Look for fees and closing costs, and factor them into your decision. Avoid the urge to ?medicate? your debt pain by making hasty decisions. Take a few days to mull over offers you?re considering.

Either option will save you money and start you down the road to debt freedom, so examine your options, make your decision, and get started!

A financial educator for over ten years, Leo Quinn Jr. specializes in helping people get out of debt and stay that way. His ?How to Own Your Paycheck Again? program has helped thousands of families improve their finances and escape the debt trap. Learn more at www.OwnYourPaycheck.com.

Other Article Sites

findabook.com  moneycd.info  a-mortgage.info   about-lemon-laws.info  aboutstudentloans.info
all-about-publishing.info  auctions-articles.info  bestcollege-university.com  bestispconnection.com
biblefolder.com  blogger-website.com  books-used.info  brokers-guide.info  buywindows.info  cable-dsl.info
career-miner.com  carpel-tunnel.info  cashinaflash.info  cashloanreviews.info  casinobell.com  chat-house.info
clearmycredit.info  collegeloantips.info  crones.info  depression-articles.info   dirnic.net  dishguides.info
divers-below.com  expodog.info   financewizz.com  fire-insurance.info  getgood.info  handleit.net   it-idea.info
health-supplies.info  hosting-right.com  insidealert.com  insurance-facts.info  jobs-employment.info
justgood.info  lookgold.net   lowcost-travel.info  money-source.info  myhostzone.info  numisblog.com
peoplesearchfinder.info  pr-articles.info  realeas.com   refinancing-guides.info  spyware-remove.info
telelot.info  the-law.info   toppaid.info  travel-deals.info  travelcorrect.com  wedding-guide-site.com
your-blog.info  your-credit.info

MORE ARTICLES:

Easy Way for Newbies to Market Home BusinessEasy Way for Newbies to Market Home Business
I began the journey of owning a home based business several months ago. Like many others, I found the task of marketing my business overwhelming and frustrating. Without marketing, you don't make sales, and without sales, you can't profitably run your business.

Why Do You Want To Start A Work At Home Business?
This should be among the very first questions you ask yourself. What are the pros versus the cons of starting your own home based business? So, with that in mind, why do you want to start your own work from home business? Start up costs are relatively cheap and the tax breaks are great but the long hours and little pay in the beginning seem hardly worth it.

Recently Launched WallDecorAndHomeAccents.com Caters to Home Decorating Trends
Catering to the growing wall-decorating trend, WallDecorAndHomeAccents.com has officially launched. Unlike other home furnishing stores, which treat wall décor almost as an afterthought, Wall Décor and Home Accents' product inventory consists solely of wall home décor.

Home Improvement Tips And Advice
Top Home Improvement Tips and Advice For Everyone Who is in Need Of One.

Use Western Tapestries To Enhance Rustic Home Decorating
Western tapestries are a great way to bring authentic Native style to your home. If you love southwestern and western decor, you will definitely love decorating with colorful tapestries in your ranch style home or log cabin. Practical in many ways, you will find that rustic tapestries, when used as a tapestry wall hanging or tapestry wall art, bring your room to life and give it a wonderful southwest feel.

French Door is Alternative For Home Improvement
Doors that can be used on homes now come in many types for many applications Usually the main factor in choosing the doors to use on houses will depend on the taste and the preferences of the owners

Video Surveillance for the Small Business and Home
Video surveillance, originally developed for use in airports, banks, and casinos, have become famous in homes and small businesses. The development of easy-to-obtain and reasonably priced video surveillance equipment have amplified the trend in small business and home use.

Property By Owner, Inc. Releases The For Sale By Owner Secrets Bootcamp Home Study Audio Course
New Real Estate Audio Course Provides Tips, Techniques And Strategies Any Home Seller Can Use To Sell Faster Than The Competition And Generate More Net Profit

Houston Real Estate Finds a Home on PropertyMaps.com
The free online real estate search site, PropertyMaps.com, adds Houston MLS listings to its growing publicly searchable database.

"Eli Appreciation Night" Set For New York Titans Lacrosse Home Opener At Madison Square Garden Thursday, January 31
The New York Titans Lacrosse Team will show appreciation for New York Giants Super Bowl Quarterback Eli Manning by allowing fans named "Eli" or fans who wear a New York Giants No. 10 jersey free admission to Thursday, January 31 Game at Madison Square Garden.

Leaving Your Child At Home Alone
An estimated 5 to 7 million American school-age children go home to an empty house after school and fend for themselves Some people say that being alone promotes responsibility and independence; others argue that the lack of supervision fosters delinquent behavior and hampers emotional and social growth

Signs Of A Real Internet Home Business
The world of internet home business is often clouded by people trying to scam opportunity seekers. This can make for a very disheartening and difficult process of finding a real home business opportunity.

Wheelchair Lifts for the Home
A wheelchair lift is a mechanical devise that is used to lift wheelchairs. There are so many different types of wheelchair lifts in the market today. These allow easy mobility at home and outside of the home.

Modular Home Timeline
Because modular homes are built in part in the factory setting, and because components of the building process are split between your builder and the manufacturer, the timeline for modular homes can be a little different than site-built homes In an effort to help you anticipate what to expect, a typical schedule of events will be described to help you through the process

Quick Tips on how to eat well - in or out of the home
Here we deal with the essentials the basic essence (stocks). These can be compared with the foundations you lay down when building a house. Once these are prepared you can build your dish on them.It is important that the cook / chef give time and care to these simple however very important step of preparation. Chicken stock is the foundation on which most people build all meat sauces. By adding roasted, grilled, or poached trimmings or bones, or infusions of herbs and vegetables, or different types of alcohol, you can introduce new flavours and develop an individual sauce for each dish.