Use a cash-out refinancing to make home repairs?
News from Inside Fidelity:
Dr. Don Taylor, Ph.D., CFA, CFP
BANKRATE — 12/20/11
Dear Dr. Don,
Is cash-out refinancing the best option for me? I owe $ 13,000 on a home appraised at $ 140,000. With the low rates, I’m working on cash-out refinancing for $ 100,000 at 4.6 percent over 25 years.
My house needs new garage doors, an air-conditioning unit, a new water heater, 600 square feet of flooring and new siding. My city is currently offering home energy audits and rebates for installation of a new AC unit, water heater, etc. I plan to stay in the house and want to retire in five years.
The money I don’t use for house repairs, I plan to pay back to the bank. I’ve worked hard all my life for excellent credit and have taken care of my things to last for a long time. I can’t afford a mortgage payment and home equity loan payment on top of it. My payments will be $ 900.
I’m on the fence about holding out for two more years to…………… continues on Inside Fidelity
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Money Talk: Borrowing to invest is not best advice
News from INFORUM:
Q: We are getting coaching from a finance adviser. He suggests using a home equity line of credit as investment capital. Your opinion on this?
A: You’re not dealing with a financial adviser who has your best interests at heart. You’re dealing with a salesman who is mostly, if not solely, concerned about the commission he’s going to earn from selling you an insurance or investment product should you take his unsound advice.
Borrowing to invest is a risky strategy. Putting your home on the line to do so…………… continues on INFORUM