“Up on the HELOC, reindeer paws …”
November 16th, 2005 | by mbhunter |Think you’re going to be a little short this holiday season? Hey, not to worry! Some banks and some consumers have the answer — open a home equity line of credit (HELOC) to pay for all of those fantastic gifts!
Home equity for the holidays — credit cards are so passe now! Your home has gone up few hundred thousand over the past few years — why not treat yourself?
Whatever.
At least this BankRate.com article on MSN issued a decent warning about this special kind of consumer debt: Your house is on the line. The bank can take your house away from you if you don’t pay it back. Not even bankruptcy can save you here.
Why pay an additional 20-30% or more in interest on stuff that probably is no longer fun to use after January 7th? And put your house on the line? Doesn’t make much sense.
What does make sense, though, is stated very nicely in the last line of the article:
When it comes to gifts and holiday travel, the best financial tool is to stay away from debt in the first place. Instead, use the financial tool that can’t be beat: a savings account.
Exactly!
2 Responses to ““Up on the HELOC, reindeer paws …””
By SMB on Nov 16, 2005 | Reply
Oh, the thought that folks might actually take advantage of this “opportunity” is so depressing…
By mbhunter on Nov 24, 2005 | Reply
Yes. Most of us don’t need any more debt.