What are the advantages of a home equity loan?
The two major advantages of a home equity loan are a lower interest rate and tax savings. The interest rate you pay on your average home equity loan is lower than the interest rate you will pay on your average credit card by 7% to 10% or more. Home equity loans also have a lower interest rate than personal loans and other types of non-secured debt. For home equity loans, you can generally deduct the interest you pay on the first $100,000 you borrow. For purposes of home improvement or to buy another home, you can deduct even more. The interest you pay on a credit cards and personal loans is generally not tax deductible.
The two major advantages of a home equity loan are tax savings and a lower interest rate. The interest rate you pay on a home equity loan is lower than the interest rate you will pay on your credit cards by 7% to 10% or more. Home equity loans also have a lower interest rate than personal loans and other types of non-secured debt or loans. For home equity loans, you can generally deduct the interest you pay on the first $100,000 you borrow. For purposes of home improvement or to buy another home, you can deduct even more money. However, the interest you pay on a credit cards and personal loans is usually not tax deductible.
