If you're a typical American consumer, you have too much high-interest debt, and it's costing a bundle to service it. When a lender offers a chance to lower those monthly payments with a low-interest, home equity loan or a cash-out refinancing, it can feel like manna from heaven. But don't kid yourself: no one is passing out free lunches. When you tap home equity to pay off bills, you kiss off those high monthly credit card payments, but you don't kiss off the debt.
Tapping home equity makes it easy to get rid of credit card debt, but that state of bliss is usually fleeting. Why do folks rack up so much credit card debt in the first place? Could they be living beyond their means? Most folks who use debt to get rid of debt forget to change their negative spending habits and end up deeper in the hole.
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