Is HELOC a Good Idea? | Pros & Cons of HELOC (Home Equity Line of Credit)
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- čas přidán 3. 08. 2024
- What is a HELOC? is HELOC a good tool to pay down high-interest debts? Can you use HELOC to fund your early retirement?
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⏰ Table of Contents ⏰
0:00 HELOC Explained
6:02 HELOC Pros and Cons
#FIREPsyChat #FinancialIndependence #HELOC
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You really broke this down in a way that people can understand it
Best video addressing my concerns
Thanks for the info. Very easy to understand. I’m retiring in 4 years and was thinking of a HELOC for home improvement and bills. After watching this video I’m gonna pass on this and work harder at paying in cash.
No problem! No matter how much I calculate the ROI, a HELOC just doesn't make any sense.
Rates are too high still.Good decision
I agree. Me too!
So you want to get more debt to pay debt and put you home at risk?
I thought this was excellent. Especially at the end with the Pros and Cons. I have watched TONS of videos on HELOCS.
Excellent content and informative! New subscriber. ❤
Thank you for sharing.
Excellent explanation! 🙏
Thank you for your help. I lost my job and have debt and almost got a HELOC.
subbed!
I tried a home equity loan with my mortgage company. I was asking for 35k. They wanted to redo my entire loan to bring the 35k into the total mortgage balance. Then they wanted closing costs of $7600 and a $320 startup fee, and to add insult to injury, they wanted to increase my APR from 2.5% to 8.5%. To hell with them.
That’s absurd but at the same time I never found HELOC or HEL to be beneficial at all. Thank you for sharing
Subscribed 👍
Thank you for amazing video. Great information.
Debt is dumb unless he cash flows so I am not going to continue to play these borrowing games
Those are some great questions at 2:44 . I’m definitely interested in doing a heloc and this video is very helpful. Thanks bud
You’re welcome. However, I never recommend using a HELOC. This video is just to explain how it works
@@FIREPsyChat 😲 never recommend???
Love HELOC. Best tools to flow moneys & create new moneys.
Thanks for the content. I'll probably go with the Home Equity Loan instead.
Thank you very much
No problem!
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Great video! I'm looking at a HELOC to do some home improvements and you made some good points in this video. Thank you for posting.
Glad to help! Just make sure you don’t bite more than you can chew when it comes to debt
We did it last year Oct. 37k regret it the rate will got to 8% or more. Introductory rate at first of 4% My idea was to pay it down with market gains of 2023....not enough unfortunately
Hi. Helpful video. Thanks. What do you think of taking out Heloc to fund an rental property? Thanks for your reply in advance.
nice video explanation on HELOCs
Thanks!
Thanks
Clear and clean explanation
Looking to make some home repairs. Over a 3-5yr period. Heloc sounds like a nice option. Make the repairs and pay off the debt asap. Without having to spend my savings all at once.
Excellent video good job 👏
Thanks!
In other words,like any other credit issuer. They charge you to use your own money. Not knowing anything about this. Based on your explanation of this. One would give INTEREST in their property to another. It’s bad enough that mortgages are what they are. Then to add something like this into the mix. Just spells lien on your property to me. Great vid
You nailed it. I’m never taking out a HELOC. this video is to explain what it does and how it works
Bank won’t explain like CZcamsrs (you) but just quickly send requirement documents to sign; after listening to this, I just sell my house, get the cash and pay none of them fees to the HELOC bank
Yep, I’m review HELOC paperwork right now. I was quoted a 9.5% interest rate. HELOC is for $75K, but I only need $22-$25K. I could actually pay it in cash. But want to be prepared for surprises, in the house I’m inheriting. The amount owed is for back property taxes, during probate. I just want to stretch payments for 1-2 years. But am not interested in making the place picture perfect, with renos. Just want out of my apartment as yearly rent is equal to property taxes.
Would you recommend a heloc or he loan to make an investment that will generate income cash flow ?
How do you use a HELOC on a rental property you dont live in?
With huge interest rates it is the demise of many home owners...oh and it can be called at any time!! 😮
My dad wants to take out a HELOC on our home as his brother who just moved to the states (from Mexico) wants to get a home. My uncle doesn’t qualify for a house on his own as he literally just got here less than 3 months ago and although he came to the country with around 25,000 saved, that still isn’t enough to get a home. So my dad was trying to apply for a home for him, but he was only approved for 300,000 but they would need to make a 50 to 70 K down payment, and obviously that’s a lot of money so now they’re considering having my dad get a HELOC in our property. It was bought at 147k, they owe 80k, and now it’s worth 365k. I keep telling him it’s dangerous to get a loan especially a HELOC for his brother, but it seems like he doesn’t care and is going to go forth with it.
Even more dangerous to do a loan for family. Unless it’s a gift and no repayment is expected.
what are your thoughts on using a HELOC to finance renovations in an historic home to improve energy efficiency (new HVAC, new attic insulation, window inserts, etc.)? I a have a drafty old house with 25 yr old HVAC system, and my utilities are through the roof. I'm estimating needing 50k to do this work and estimate saving $300 a month (gas & electric bills) after energy improvements.
I am against it because the math doesn't add up to me. Now you're looking to spend $50K to save $300 a month. So if you pay $300 back to your $50k, that's almost 14 years. You're going to pay 10% in interest for 14 years? Can't you save cash and pay for the home improvement and not do the entire project all at once?
Thanks for open my eyes on a heloc obviously is a sweet trap bcz is a credit card better I open a regular credit card without put my roof in danger if something happens on the road
Just remember that credit cards can become your worst enemy if you don’t treat them with respect
@FIREPsyChat i understand, but u don't lose u home overnight using a credit card. If you open a heloc account, that is exactly what happen be a homeless for a few thausand if someone get wrong
Its really only worth getting a HELOC if youre doing velocity banking in my eyes. If you can dump your income into it and pay expenses out of it. Its a fantastic strategy.
I may be looking more towards a home equity loan. I over estimated my ability to keep track of debt my interest rate is currently at 2.5 and definitely don't want to refinance the full amount
Don’t take out another debt to pay off your current debt
During the interest payment period, are you able to pay more per month in hopes to pay back everything early?
Yes
That's the exact strategy of velocity banking. Pay all expenses out of it, deposit all income in it, use positive cash flow to drive down principle balance and avg daily int.
Hello! Question, 60,000 in 5 different Credit cards and Taxes owed. 250,000 n equity. Is Heloc a good wait to pay these off?
Hey Joe, getting a HELOC is just treating a symptom of another financial problem. What’s the root cause of the $60k credit card debt and how do you never get back into it? I’ve been there. I had $110k in debt. You can schedule a complimentary coaching session with me by visiting www.firepsychat.com/coaching.
Depends on the cc interest rates. The nice thing is depending on the provider you can pay direct to your principal on the heloc on top of the interest payment. Allowing you to pay the debt off faster. If you can afford to do it this way and then not touch the heloc during the draw period after you have paid it off then your golden.
Not sure why anyone would want to take out a HELOC…
what are the pros and cons of having to listen to another talking head drone on about HELOC? it is easy...people are overspending with money that does not belong to them at an high rate with usually INTEREST ONLY payments ..... its not rocket science to figure out the dangers of that...get rid of the bad lamp and curtains...clutter is not needed when discussing finance.
Wtf is a droll period?
Draw., mean withdrawal.