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Refinance/Cash Out or HELOC or Personal Loan

DeacWatcher

DeacWatcher

Ricky Peral
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I have been in my house 11 years now and some major home improvements are coming due (roof, HVAC, driveway, and kitchen updating). I have about 120K in equity on the house but don't really want to refinance the job as I don't want to lose the 3.35 interest rate I currently have. I'll need about 60-75K to do what needs doing. I could pay for half in cash but no the other half.

What is the best way to go about paying for this?
 
HELOC interest is still tax deductible (usual caveats about how that may or may not help you depending on your personal tax situation yadda yadda) personal loan is not.
 
Right - HELOC is still tax deductible so long as you spend it on improving the house, not on a car or vacation or something. Def the way to go.
 
Is HELOC still tax deductible if you use it as a down payment on another house?
 
tell the wife the driveway and kitchen can wait till you've saved up for it.
 
Does the HELOC need to be with your existing mortgage holder or can you shop around?
 
DeacWatcher said:
Does the HELOC need to be with your existing mortgage holder or can you shop around?
Click to expand...

You can shop around.

The best deal I got was with the bank that holds my mortgage, but I think that was largely coincidental.
 
I second HELOC as well, especially if you can get it with your current lender. Makes everything really easy. We closed out our old one a couple of years back, but I'm thinking about opening a new one since houses in our neighborhoods have skyrocketed in value. May open a new one and pay off some lingering debt, plus build a garage.

Having a HELOC was a boon for us before, and we weren't even making home repairs. Just paying off old debt and deducting that from taxes was fantastic.
 
RaleighDeacon said:
I second HELOC as well, especially if you can get it with your current lender. Makes everything really easy. We closed out our old one a couple of years back, but I'm thinking about opening a new one since houses in our neighborhoods have skyrocketed in value. May open a new one and pay off some lingering debt, plus build a garage.

Having a HELOC was a boon for us before, and we weren't even making home repairs. Just paying off old debt and deducting that from taxes was fantastic.
Click to expand...

Just be aware that paying down your old debt is no longer a tax-deductible use for a HELOC. Building a garage probably is.
 
Credit Unions usually have the best rates on HELOCs. You can defs get one from wherever for usually $0-$250 in closing costs.

ETA: HELOC is better choice due to tax treatment, but one snag can be loan to value of home. If you have 80% mortgage, they may not loan you much more.

If loan to value doesnt give you enough cash to work with, I would recommend So-Fi for personal loans. They have low rates. Great for student loan refi too.
 
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