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| *Loan,banking and credit>>>credit line |
Is a home equity line of credit a good enough source for cash reserves? |
Can that line of credit term change if the property depreciates? It depends on the amount of your credit line, but it never hurts to have some emergency money in savings or a money-market account also. Also, the prime rate is now 8.25% and most home equity lines of credit are in the 9.15-9.5% (very high rate). If you have already been granted a line of credit, that amt will stay the same. It's only when you request an increase in your credit line, that they might require a re-appraisal of your home. I hear it's a bad thing because if you can't pay your loan they get your house It depends...are you talking about for your own peace of mind or to qualify for a new loan. For your own peace of mind: your rate probably isn't locked in, so if you're comfy with that, then yes. To qualify: no. NO!!!! The interest will eat you alive, and your more likely than not to use the money for things you don't really need just because it's available. Not to mention it's an lien on your house and if you get into the least little bit of financial trouble you could end up loosing your home. Just start saving your money! Source - life If you use it as a cash reserve then its a bad Idea. Helocs can be good if you manage them correctly and only draw against it when needed and you know you have the income to pay it off. Sometimes there better then refinancing if you need only a little cash. YES ! In most cases taking out a home equity line is a good idea. You only pay on what you use Its just acreditcard secured by your house. |
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