By Tim Kowols
Paying credit card debt with a home equity loan could spell trouble for new homeowners down the road. According to CreditCards.com, homeowners are tempted to use a home equity loan to pay off the debt due to the lower rates and the deductibility of the interest payments. Gay Pustaver from Money Management Counselors warns against this route, saying you are turning unsecured debt into secured debt.
Pustaver recommends relying on a management plan to address credit card debt because often people who use a home equity loan to pay off the outstanding amount end up in more trouble later down the road. You can hear more from this week’s Money Management Monday interview with Gay Pustaver below with this story.