What can a HELOC do for me?
Used correctly, a HELOC is one of the most versatile financial tools available to a homeowner. In addition to home improvement and debt consolidation, many people use their home equity lines in some very useful and innovative ways. If you need to manage debt, improve cash flow, or access cash for your home or business, you should consider getting a HELOC.
-Mr. Heloc
You can use a HELOC to:
- Reduce insurance premiums.
- Pay charge cards before the due date.
- Manage cash flow.
- Give themselves emergency "Pay Day" loans.
- Save money on taxes.
- Take advantage of special offers and deep discounts.
Save money on home/auto insurance- You probably know that if you increase the deductibles on your auto and homeowners insurance policies you can save a lot on insurance premiums. If you increase the deductible on a homeowners policy from $500 to $1,000 could cut your premium by as much as 25%! Most people don't do this because they wouldn't have cash available if there were a loss. With low-interest cash readily available through a HELOC you'd have the ability to raise your deductibles and get big savings!
Check the effect on the rates.
Reduce credit card balances- Many people rely on credit cards to smooth out their cashflow. However, a carefully managed HELOC is usually a less costly, more effective tool for cashflow management. Credit cards are convenient at places like restaurants, stores, or on the internet. Unfortunately, using them can be costly and the interest is not deductible. If you have to use your credit cards to purchase goods or services, your HELOC can pay them off before the payments are due.
There is an option to high interest cards
Give yourself a Pay Day Loan- If you frequently need to take a high interest short-term loans before payday to make ends meet...STOP! A HELOC loan can be an effective, low-cost way to help cover temporary cash shortfalls. When you need cash you can draw on your HELOC loan and make only the minimum payment each month. Later, you can replenish borrowed funds when your busy season arrives.
Compare a HELOC to a Pay Day loan.
Special offers and Deep Discounts- Credit card companies frequently offer shopping special programs on a 30-day free trial basis. These programs allow you to buy discounted gift cards (as much as 20% off) for major national retailers. The flexibility afforded by a HELOC loan can allow you to purchase (during the free trial period) a large amount of discounted gift cards for major retailers you frequent. Although you pay low interest on the home equity credit line, you can give yourself an upfront discount of 20% on everything you buy.
Here's an example of how it works.
Buy investment property- If someone offered to sell you a house at a discount if you could give them cash by Friday, would you be able to buy it? If you have reasonable credit, you can buy an investment property with a 10% down payment. I know people who use HELOCs to provide the 10% then use the rent that they receive to pay the mortgage and make a profit.
Use a HELOC for downpayment and closing costs.
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to get a HELOC.
