Quote:
Originally Posted by BRAKE!
I would always advise against using your home as collateral for more loans outside of your primary mortgage. The more you borrow, the more expensive your payments become. How much longer do you want to keep overpaying (in interest) for the things you want/but not need? Plus, there is always risk involved with not being able to pay back your loans; life happens, medical expenses can pile up, one can lose a job etc. it’s at those moments where the last thing you need is someone’s hand in the sanctity of your home.
“This isn’t a matter of stretching finances for something we can’t afford” - by definition, if you have to borrow money to get it done, you’re stretching your finances.
Ask yourself, why can’t this wait 18 months when you actually have the money to do this (in your budget) and you don’t have to pay a cent in interest?
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Okay, ask yourself, do I pull money from my investment portfolio which for me was just over 48% return in 2021 or do I use my HELOC and pay 1.85%?
So use my ‘cash’ by selling some of my portfolio and lose 48% return? Or dip into my $1mm HELOC pay 1.85% and net 46% return by staying invested?
Heck I can sell most of my portfolio and go conservative with preferred stocks and make 5-7% in dividends and still be ahead by using my HELOC.