Having multiple credit cards can be helpful, especially when making large purchases. The problem starts when you have large outstanding balances, and you're having trouble paying them off quickly to avoid enormous interest charges.
You may have heard about using a home equity loan to pay off your credit card balance. This article will look at the advantages of using this strategy in paying down your credit card debts.
Home equity is the portion of your home that you own outright. You can take out a loan against your equity with your home securing it.
For example, if your home is worth $400,000, and you owe $300,000, this means you have $100,000 of equity.
In this example, you have the equity available to apply for a home equity loan and use the proceeds to pay for your credit cards. In this way, you'll pay off the home equity loan instead --which is a much more manageable and affordable debt that most prefer.
Credit card interest rates are high (anywhere from 15-24%) so it's in your best interest to pay those off fast. A home equity loan, on the other hand, has an interest rate that can be less than half of that! So when comparing which is a better debt option, you can see how a home equity loan is better.
Credit card rates also vary over time, so you’ll be paying even more as rates climb. Home equity loan rates can come with fixed rates that ensure you’ll pay the same amount monthly throughout the loan.
Another benefit of using a home equity loan for credit card debts is you can streamline payments and simplify everything.
Juggling multiple bills can be a hassle. Having only one payment for a home equity loan decreases the chances of missing a payment.
A home equity loan is a good option to pay down your credit card debts as long as you know the risks and are sure that you can afford the payment plan.
If you can keep your home equity payments to a manageable level, you can eliminate credit card debts faster than going the usual route.
The application process for a home equity loan is generally the same as when you applied for your mortgage.
If you think that a home equity loan is the best way to pay off your credit card debts, we can help by providing the best offers, rates, and terms.
Get in touch with one of our loan advisors to know more about our home equity loans.
We've been helping customers afford the home of their dreams for many years and we love what we do.
Company NMLS: 990796
416 Myrtle Street
Santa Ana, CA 92701
Our Website strives to ensure that its services are accessible to people with disabilities. Our Website has invested a significant amount of resources to help ensure that its website is made easier to use and more accessible for people with disabilities, with the strong belief that every person has the right to live with dignity, equality, comfort and independence.
Our Website makes available the UserWay Website Accessibility Widget that is powered by a dedicated accessibility server. The software allows mygrfinancial.com to improve its compliance with the Web Content Accessibility Guidelines (WCAG 2.1).
Our Website accessibility menu can be enabled by clicking the accessibility menu icon that appears on the corner on the page. After triggering the accessibility menu, please wait a moment for the accessibility menu to load in its entirety.
Our Website continues its efforts to constantly improve the accessibility of its site and services in the belief that it is our collective moral obligation to allow seamless, accessible and unhindered use also for those of us with disabilities.
Despite our efforts to make all pages and content on Our Website website fully accessible, some content may not have yet been fully adapted to the strictest accessibility standards. This may be a result of not having found or identified the most appropriate technological solution.
If you are experiencing difficulty with any content on Our Website website or require assistance with any part of our site, please contact us during normal business hours as detailed below and we will be happy to assist.
If you wish to report an accessibility issue, have any questions or need assistance, please contact us by sending an email to: firstname.lastname@example.org