As someone who works in retail lending, the majority of the populace is not like the 1% on CP and do carry a balance on their Line of Credit.
It seems that people can budget to make a payment, but if left up to their own decision as to how much to pay, people will pay the interest only and move on.
Lines of Credit work for very few people. If you are getting a better rate on an unsecured loan that might be a better option. Honestly, if you can't afford the loan payment maybe you shouldn't be borrowing the money right now.
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Originally Posted by Pizza
if you guys have at least 20% equity in your home, get a secured line of credit. The interest is way better than an unsecured as it's prime +0.5% or 1%
just dont default on it
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Most places will provide 65% LTV on a Line of Credit secured by your property. Federal regulation changes mandated this. For example, if you want to finance a purchase with 80% borrowing and want it all in a Line of Credit, you will be told no and 65% will be revolving and 15% will be reducing in nature at most places. I know some Credit Unions will still do 75%-80% (I know we do 75%).