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Pay off credit card with fixed home equity draw?

Posted in Personal Finance | 1 Comment »

One Response

  1. Sin™ Says:
    November 25th, 2009 at 9:46 pm 1

    That Home Equity Line is almost maxed out. I wouldn’t recommend transferring the credit card balance to the Equity Line at this point because that only ties up monthly cash flow. Because they’d be paying back interest and principal over that 10-year term on the Equity vs. a couple % on credit card balance of minimum monthly payment it wouldn’t be worth “saving” .6% of interest on the balance. There’s also the inherent risk of running up the credit card balance again which would put them in a very tight situation.

    I think in this situation what they’re currently doing is fine. Keep focusing on paying down that credit card debt though and keeping the balance from growing instead of shrinking.

    Good luck.

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