Millions of people are having problems paying their debts. There are several things you can do to pay off the balances on your credit cards. Getting a home equity loan can be a smart strategy to pay off the balances. A home equity loan to pay off credit card debt has its own advantages and disadvantages, but I believe that the disadvantages are far fewer. A home equity loan may well carry a lower interest rate than what you are paying on your credit cards. And it can save you lots of money and give positively affect your FICO score.
A home equity loan is a loan that’s taken against the equity you’ve built up on your home. This mean you are given approval from the lender to borrow the money with your home is used as collateral on the loan. Most lenders will allow you to borrow only up to 80 percent of the value of your house. This loan can be extremely useful to pay off the balances on your credit cards. But you must remember to be carefully with a home equity loan because if you default on the loan, you put your home at risk of foreclosure.