Because a home equity line of credit is a low interest, tax deductible loan, many people use a HELOC for debt consolidation or the purchase of a new car. But, is it wise to put your home at risk in order to pay off credit card debt or buy a new auto? It depends on a variety of factors, according to Scott Kays, President of Kays Financial Advisory Corporation in Atlanta, Georgia.
Kays is the author of Achieving Your Financial Potential [Doubleday, 1999] and Five Key Lessons from Top Money Managers [John Wiley & Sons, 2005]. He has also made a number of appearances on national television programs including ‘Your World with Neil Cavuto’ on Fox News and ‘Closing Bell with Maria Barturomo’ on CNBC.
Debt Consolidation & Home Equity Lines of Credit
According to Kays, it makes sense for people to use a HELOC to consolidate other types of revolving debt, especially credit cards with high interest rates.
