Quote:
Originally Posted by Micvanlen
If you have equity in your home then you'll want to check out a Home Equity Line of Credit. It's not something the banks promote much because it's probably one of their lowest margin products. Here's how it works: you get up to 80% of the value of your home as a line of creadit at a rate of prime + 1. So, if your home is worth $300,000 and you have a mortgage of $200,000, then you can get a HLOC up to $240,000. Your next step is to pay off your mortgage with the HLOC. Why? becuse you get better rates, you get an extra $40K of credit to use as you whish and you can pay off as much of the credit as often as you like. That's right and it's why banks don't like it much. You can put a bigger dent into your princaple faster with complete freedome. Check it out.
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Except the bank can change that to prime +2 or more whenever they want, while mortgage rates guaranteed. Also, don't most HELOC's require you pay off 2% of the balance every month? I know some you can make interests only payments.
Can you write off the interest payments on a HELOC if you can prove the money is invested in real estate?