Need advice on home equity loan

[sumas]

Need to do repairs on a home we own that has no mortgage. Not money savy so would like to know more about this option. Thoughts anyone?

[gazhekwe]

We have a home equity line of credit on our home, the one we live in. At 3% interest, it is a good deal, but it is still a loan. When we got it, we still had a mortgage, but fortunately have now paid it off, so it is only the equity loan. Because we live in the home, the interest is deductible. We can use it for anything. Buy a car? Fix the house? Buy another house? We've done it all. The minimum payments are interest only, but we pay at least double and usually five times that much each month.

Make sure you look at the terms. Interest and payment options are key. We have fixed interest and there has been no penalty the time or two that I've been a day or two late with the payment. CRS syndrome at work. It is my understanding that non-payment could result in foreclosure.

Ours is with Charter One, and they were recently advertising low interest equity lines.

[Ravine]

Gaz, truly you are a Princess Among Women. The Best.

I've said that type of thing about you, before, but I think it bears repeatin.'

[gazhekwe]

BLUSH! Thanks so much, Ravine.

[gazhekwe]

I need to add one thing about a home equity line of credit. There may be a balloon payment of the remaining balance due at the end of a five year period. I would try to get away from a balloon payment and negotiate for an open-ended loan that doesn't have a set end date.