Home Equity Cash Out Options

One option is to apply for an equity line of credit. There are many advantages to an equity line and this may be your best option. Once it is open, your home equity line functions like a credit card. You can access money as needed in amounts of your choice. Maintenance costs are usually low and will be on the par with credit card annual fees. There may be a special low introductory rate and it will usually carry lower rates than a home equity loan. This type of loan is great for financing your children’s college education. If you have college-age children of varying ages, you can get tuition money for the first child, then pay down the balance in time for your next offspring’s higher education. If you are selling your home, an equity line of credit can provide you with fast cash for home repairs that your buyer might require before final sale. A home equity loan can also be a wise choice if interest rates are good. With this loan, the entire funds are paid to you upon closing of the loan. You will have monthly payments for the life of loan so you can plan ahead financially. Most loans will carry a fixed rate, rather than the variable rate commonly found in home equity lines of credit. The home equity loan is good for eliminating high-rate credit card debt. Paying off the credit card balances and making just one home equity loan payment per month can create substantial savings due to lower interest rates and tax deductibility of interest.