Is getting a home equity loan vs. a personal loan a bad thing?

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6 Responses to “Is getting a home equity loan vs. a personal loan a bad thing?”

1. poisoned in hospital on: 20 December 2009 at 7:39 pm

   The advantage of a home equity loan is that you can normally get a lower interest rate and the interest in normally tax deductible. If you have a home with equity it should be simple to get the loan. I cannot imagine why an attorney is involved.

   If the process is scary you should probably go to a different bank for the loan. You can go online and get plenty of them which are farily simple to work with.
2. kitty.hicks on: 20 December 2009 at 7:39 pm

   Well usually you will get a better rate with a Home Equity loan. I reckon it would depend on how much the loan was for. If just a few thousand a persoanl loan would be better, but if we are talking about several thousand or more then a mortage is best.
3. Lianne on: 20 December 2009 at 7:39 pm

   The benefit of a home equity loan or line of credit over a personal loan is that the interest you pay is tax deductible. But, the use of using helocs and the practice of tapping into home equity is raising just concern among the financial experts.

   http://money.cnn.com/2006/07/31/real_estate/helocs_from_hell/index.htm

   http://money.cnn.com/2006/04/28/pf/expert/ask_expert/index.htm
4. treday25 on: 20 December 2009 at 7:39 pm

   I agree with the points the other posters made. But, you have to be sure you don’t go out and run up that debt again or it could be financial suicide.
5. bianca on: 20 December 2009 at 7:39 pm

   with equity line of credit there is not attorney involved.
   if you need couple thousand dollars- personal loan will work better, because you will repay this loan in couple years like any other installment loan. equity line work like credit card , you have to pay more, than minimum payment to pay your loan, but if you pay , you can use this money again and again for 10 years.
   if you use only part of your equity, you pay only for this amount.
   interest rate is lover on equity, than on personal loans and equity can be tax deductible.
6. kootie33 on: 20 December 2009 at 7:39 pm

   get the home equity loan. you’ll get a better rate, plus you get more payment options