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Please add 8 and 1 and type the answer here:
Mortgage Rates
30 Yr FRM 4.83% -0.08%
15 Yr FRM 4.32% -0.04%
1 Yr ARM 4.35% -0.11%
5/1 Yr ARM 4.25% -0.04%
30 YR Tres 4.25% 0.00%
Fed Prime 3.25% 0.00%
 
Q: If I get a home equity loan do I have to use it towards the house or can I use it to pay off other debt?
  • There should be no reason why you cannot use the proceeds towards paying off other debt. A home equity loan is typically a second mortgage which constitutes as a cash out refinance. If you qualify for the new loan, the lender has no business telling you how you can and can't spend your money.

    On a side note, you reference using your home equity line "towards the house." This infers your participation in a home loan accelerator program. Although some may beneift from such programs, with inflation looming around the corner, having a fully adjustable rate could lead to a significant rate increase and substantially larger payments.

    To digress, paying off high interest credit cards, is definitely smart use of a home equity loan.


    Answer Submitted on Thu, Apr 2 2009

    Rate this Answer:
    Answer Contributed by: Peter Gladkin
    Peter Gladkin
    CA Broker 01792241
    760-730-5040
    References Available...Referrals Accepted
    www.akfin.com
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