Should I take out another home loan?
Posted in Personal Finance on 05/27/2009 08:53 am by admin
rollsrock18 asked:
I’m trying to make a financially sound move, deciding whether or not I should take a second mortgage or home equity loan against the equity in my house. Here’s the scenario: 670 median credit score, debt to income is about 40%. House appraised for about 100K, still owe 60K. I have credit card debt and I want to also do home improvement. I have three credit cards, two of which are maxed out because I’ve been doing home improvements with the availability on them. I want to use about 20K in equity to pay off the cards, and use about 5K of it for home improvement so I can sell the house when the housing market improves in a few years.
I’m trying to make a financially sound move, deciding whether or not I should take a second mortgage or home equity loan against the equity in my house. Here’s the scenario: 670 median credit score, debt to income is about 40%. House appraised for about 100K, still owe 60K. I have credit card debt and I want to also do home improvement. I have three credit cards, two of which are maxed out because I’ve been doing home improvements with the availability on them. I want to use about 20K in equity to pay off the cards, and use about 5K of it for home improvement so I can sell the house when the housing market improves in a few years.
Should I go for it?
CARROLL
05/28/2009 at 7:49 pm
DWIGHT
Live within your means, pay down your debts and think about making the home improvements when the housing market improves and you can afford the costs which you cannot right now. Think about this. Your debt is consuming too much of your income as things are now. It will only get worse as you take on even more debt. Don’t do it.