A closed-end home equity loan could be a great source of funds for a number of reasons: no change in an existing first mortgage, the possibility of tax deductible interest (consult your tax advisor), low interest rates, no mortgage insurance required, and you can use the loan for any purpose. A Home Equity Loan is the right choice for things like debt consolidation and single-purpose purchases. These purchases could include: automobiles, medical bills, college tuition, and even extra cash.
Lower monthly obligations
Possible tax deductions
Lower interest rates vs. credit cards
Simple interest vs. compounding interest
Increase cash flow
Closed-end Home Equity Loan rates vs. Credit Card rates
(Home Equity Line) Line of Credit Benefits
As far as consumer loans go, Home Equity Lines of Credit have some of the lowest interest rates and minimum payments. Application and documentation requirements are generally less demanding than traditional first or second mortgages. This makes it easier to qualify. Mortgage insurance is not required on any Home Equity Lines of Credit, thus reducing monthly payments. Interest payments may be tax deductible (consult your tax advisor). Home Equity Lines of Credit may reduce your monthly debt payment if the borrower uses them to pay off existing debts.