Our rate table lists current home equity offers in your area, which you can use https://www.paydayloanstennessee.com/cities/hixson/ to find a local lender or compare against other loan options. From the [loan type] select box you can choose between HELOCs and home equity loans of a 5, 10, 15, 20 or 30 year duration.
How much money could you save? Compare lenders serving Los Angeles to find the best loan to fit your needs & lock in low rates today!
By default 30-yr fixed-rate refinance loans are displayed in the table below. Filters enable you to change the loan amount, duration, or loan type.
Should I Use a HELOC to Lower My Debt Payments?
A Home Equity Line of Credit, or HELOC, is a loan made on the amount you have acquired in home equity. Though you are still paying off your home, you can borrow on the value of your home that you have already paid off. If you have been living in your home for only a few years, you may have very little equity or even no equity. However, if you have been living in your house for a decade or more, you could have tens of thousands of dollars available to borrow.
A HELOC can come in handy if you want to add on to your home, remodel, or pay off other debts, such as credit cards, car loans or medical bills. However, you should carefully consider your options before making this choice to take out an additional line of credit. Understanding the advantages and disadvantages can help you to make the choice.
Benefits of a HELOC for Consolidating Debts
A HELOC can help you to lower your debt payments by lowering your interest rate. For example, on , the national average interest rate for a 30-year fixed rate mortgages was 2.87 percent, while the average credit card interest rate on cards assessed interest stood at percent in . Though lines of credit may have a variable interest rate and a shorter term than a 30-year mortgage (anywhere from 5 to 15 years), the rate is still likely to be significantly lower than that of most credit cards and other forms of consumer debt. A good rule of thumb is HELOCs often charge between 2% to 5% more than first mortgages.
By lowering your interest rate, you may be able to pay off your debt more quickly. Making the minimum payment on your credit cards can take you years to pay off your debts. By consolidating your debt with a HELOC, you can make one monthly payment with a lower interest rate, allowing you to both pay less each month and to pay off your debt more quickly. Depending on the amount of your debt, you could save several thousand dollars in interest charges in the first year alone.
In the past interest paid on home equity loans and HELOCs was tax deductible, but the 2018 tax bill no longer allows the deductiblility of equity debt unless it was taken on to build or substantially improve the homeowner’s dwelling. Interest due on first mortgage debt still remains tax deductible.
Disadvantages of Leveraging Your Home Equity
When you pay off your credit cards, you clear up a significant line of credit. No longer are your cards maxed out, and no longer do you have to be careful about using them. This may tempt you to spend more freely, which could lead to the accumulation of more credit card debt. Before you know it, you could max out your cards again, and then you would have the same credit cad debt you did before in addition to your monthly HELOC payment.