Question : What is better, home equity loan or line of credit on home I own outright?
I just finished building my house and I have no mortgage or anything as I had enough cash to buy the land and build outright. But, I have no money left to landscape and have some medical bills I would like to pay off. Can I get a home equity loan or line of credit on my house? Which is better?
- asked by aidal1135
All Answers:
Answer #1
Take money out to finish the landscaping but don'tpay your medical bills with it....and I'll tellyou why.Medical bills can NEVER be placed as alien against your home, and as long as you aresending them money on a regular basis, they can'tturn them over to collections. Just call eachone, set up a payment plan and stick to it.If youuse a HELOC to pay off medical bills, do you knowwhat you have done? You just took unsecured debtand turned it into SECURED debt, and in the eventthat you can't pay them off, obviously you canlose your house.Medical collections just usuallyhave a single fee associated with them andgenerally do not generate interest...if you use aHELOC to pay them off, then you have just addedinterest to the debt.
- answered by Mary B
Answer #2
A mortgage would be your best bet when it comes toa lower interest rate.Most banks have prepenaltypayments on most of the equity type of loans.However the line of credits generally will not.
- answered by Big Deal Maker
Answer #3
I don't agree with Mary's answer, if you havemedical bills outstanding, those will appear onyour credit report and if you are having troublepaying them, the creditor will eventually do acharge-off, which will also appear on your creditreport. With a HELOC, you will pay interest onthe entire amount. On a line of credit, you willonly pay interest on what is being borrowed at thetime. Both could have fine print fees you willneed to check out before signing on the dottedline. Some lines of credit will charge you atransaction fee each time you access it, typicallyaround 3% of the transaction.
- answered by godged
| 
measure and fulfill your financial needs
