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HelpUnlocking your home’s equity to make home improvements, which hopefully increase your home’s value, is perfectly logical if you have sufficient equity and extra income to fund the new debt payment. But in some cases, a home equity loan might not be the best idea. For example, using a home equity loan to build a pool in your backyard, which have historically shown to be a worthless addition (depending on the area). Any number of websites can provide you with estimated returns on new additions to your house.
Also, a home equity loan doesn’t necessarily need to be used on home improvement. For example, many people use part of their available equity to buy a new car for example. Hey, who wouldn’t want to have a home equity loan deduction while driving around in a brand new car? But in this era of low interest rates, if you have good credit, you can likely find a car loan that has a lower effective rate. In addition, it doesn’t make logical sense to tap your home’s equity to purchase a depreciating asset.
Just take a step back and think about what your goals before spending your home equity dollars.
Other articles you might like;
- Home Equity Loans Often Too Tempting for Homeowners | Home Equity Loans
- Home Equity Loans Often Too Tempting for Homeowners « Easy Home … Dollars on Me
- Home Equity Loans Often Too Tempting for Homeowners « Easy Home … | best--homeowner--loans.Co.CC
