home equity loans... any pointers?

by chickpea 7 Replies latest jw friends

  • chickpea


    my educational institution is about
    to block any further registration
    until i come up with some major
    tuition, even tho i HAVE been
    timely in my "installment payments"

    seems i am taking courses at a much
    faster rate than my payments are
    covering tuition, so i need to get
    the balance zeroed in order to stay
    registered in the last 4 classes....

    we own our home outright, no mortage,
    and the loan would be to cover tuition and
    zero out about $3500 in CC debt, directing
    all payments to one source, with a single
    (hopefully lower) interest rate.....

    does this sound sound or am i totally missing some
    critical aspect of the home equity loan process?

    if anyone has info or experience. i would appreciate
    hearing your experiences, good or bad

    i go to the bank next week to start asking
    and would really like not looking stoopid


  • Psychotic Parrot
    Psychotic Parrot

    Nice poem

  • whereami

    Sounds like you fit the bill. Depending on how much equity you want to pull out of your home, you should be able to geat a grate rate.

    Just make sure you rate is a fixed, which these days pretty much noone is offering an adjustable anymore. And don't settle for a rate any higher than 4.875%.

  • JeffT

    If I'm reading that right, you need $3500? Don't mortgage the house for that. A free and clear house is major security if the economy really tanks. Talk to a bank about a personal loan. Talk to your financial aid office about tuition loans. Pawning the house should be a last resort.

    My $.02 (but I am a real estate accountant)

  • tec

    I think its about tuition AND 3500 in credit card debt. It would depend on the tuition, I think. But I agree... pawning the house definitely a last resort. My aunt and uncle did it... then did it again... and finally had to sell the house and start renting again because they couldn't afford what they'd racked up. Sometimes it works out just fine, just have to be careful with what you do with the money.


  • chickpea

    it is tuition and CC debt .... looking to be less than $20K

    after reading JeffT's suggestion, it occurred to me that
    the adjacent property we bought about 10 years ago
    (unimproved small bldg on .33 acres) is not on the deed
    for the major property, so we will likely use that property
    for any collateral required.....keeps the house off the table

    it makes it all seem less urgent

  • Scully

    You should be able to qualify for a student loan. Also, check into the possibilities around scholarships, internships or working as a TA (teacher's assistant) if your program offers them.

    Student loans are usually at a reasonable interest rate and the repayment schedule is spread out over a longer time period than a home equity loan would be. Depending on where you live, once you've completed your studies, you may qualify for some loan forgiveness (mine covered about 25% of the full amount of the loan).

    If at all possible, avoid going the home equity route. I wouldn't recommend gambling with a person's financial security that way.

    I prefer the idea of utilizing your unimproved property instead of your principal residence as collateral but only if the student loan thing doesn't work out.

  • JeffT

    What Scully said.

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