home equity

5 questions to ask before you tap into your home equity

What are my other options?
Previous
6 of 6
Next
What are my other options? | mr.water/Shutterstock.com

What are my other options?

Don't be too quick to tap your home equity. Instead, consider:

  • Alternative sources of cash. Is there a savings account you might tap into? Is there anything you could sell, like investments, that could cover the expenses you are looking for? Could you borrow 50% and pay the rest yourself? Maybe friends or family might be willing to lend you money.
  • Credit unions and marketplace lenders offer personal loans, too, with fixed rates and payments. And there are federal government and private loans for education.
  • Borrowing against yourself. Look into taking out loans against your life insurance or retirement accounts. Make sure to do your research, though. Your life insurance and retirement accounts are at stake!
  • Not borrowing at all! Luxuries such as vacations, a high-end wedding, expensive clothes, and so on, should be paid for with money you actually have. If you think about it carefully, you'll realize that most spending doesn't justify borrowing against your home.

RATE SEARCH: Shop today for a home equity line of credit.

Previous
6 of 6
Next

advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
advertisement
advertisement

Ask Dr. Don

HELOC vs. reverse mortgage?

Dear Senior Living Adviser, If you have a home equity line of credit , or HELOC, for $150,000 with no balance on it, should you use it instead of a reverse mortgage? Which is a better way to save the assets if there is... Read more


Connect with us