| A 100% home equity loan can free up your cash at a | | | | makes sense if you see immediate financial |
| low interest rate. While favorable rates and tax | | | | improvement. For purchases that don't appreciate, |
| benefits make this option look good, consider your own | | | | save up for the purchase. |
| financial situation first. Asking yourself the following | | | | Using all of your equity takes away a financial cushion |
| questions will give you a better idea of how much a | | | | that you can use in an emergency. If you have no |
| 100% home equity loan can help you. | | | | other cash reserves, it is best to use another type of |
| How Cheap Is Your Loan? | | | | credit or only part your equity. |
| Is the APR on your prospective home equity loan | | | | When Do You Plan To Move? |
| better than what you can find for a personal loan or a | | | | Another factor to consider is when you plan to move. |
| credit card? Chances are that home equity loan rates | | | | By drawing on all of your home equity now, you won't |
| are better. If you don't know, take the time to research | | | | receive much from selling your home in a year or two. |
| rates now. Lenders will post their APR online or you | | | | After a couple of years of paying back your principal |
| can receive an emailed quote in minutes. | | | | and of your home appreciating with the market, you |
| When you take out more than 80% of your home's | | | | will have enough equity built up to receive something |
| value, you can't qualify for the lowest rate. This can still | | | | when you sell. |
| be cheaper than other types of financing though. | | | | Maxing out your home equity is best for cases where |
| Another factor in your loan's cost in the tax | | | | you can see immediate financial gain. Otherwise, keep |
| advantage, which you don't receive with credit cards | | | | at least a part of your home's value for future financial |
| or personal loans. | | | | needs. And always check with several lenders to be |
| How Will You Financially Benefit From Your Loan? | | | | sure you are betting the best deal, no matter what |
| Are you planning to pay off high interest debt or go | | | | type of loan you choose. |
| furniture shopping? Tapping into all of your home equity | | | | |