Quote:
Originally Posted by Pizza
why? interest rates on a Home secured line of credit is significantly lower than creditcards and unsecured lines of credit
|
I've seen far too many people let their home-secured LOC get away from them then have to bust their asses to fix the mess, my parents being a good example. It's too easy to think "ah, the interest is nice and low, put it on the LOC" and before you know it, you're never getting out from under that thing.
I see the high interest rates of credit cards as a deterrent from racking them up. A high interest rate is punitive so it encourages me to a) not spend beyond my means, b) make smarter purchasing decisions, and c) prioritize paying credit cards off faster if I do need to carry a balance.