Adrian Newman’s latest ‘e-Wealth Daily’ article is titled “Weekend Success Bulletin”. [Adrian Newman’s Article]

Adrian Newman’s latest ‘e-Wealth Daily’ article:

Weekend Success Bulletin

Recently, I was asked by one of my readers about getting a home equity loan.

For those of you unfamiliar with the concept, a home equity loan is securing a loan against the equity in your home. The interest rates are usually some of the lowest available because the borrower is using their real estate as collateral. Lenders see this as a solid, thus the low rate (sometimes variable).

But the question for those who want to borrow against their home is usually, “Should I do it?”

Traditionally, home equity is considered an asset that should only be borrowed against in case of an emergency. And with the economy still in state of struggle, the definition of emergency is expanding its definition.

So to help answer the question of whether you should or shouldn’t borrow against your home, I want you to think of the following:

“Will I be abusing this loan?” This might seem like a harsh question to ask, but it should be right at the top of your list. Are you getting this loan knowing full well you won’t be able to pay it back and are willing to deal with the consequences later on? Do you plan on using this money for some frivolous luxury that you feel you deserve, but will only put you deeper in the hole? Take a moment and think about what your plan is. The
key point to remember is that you have to pay this money back by a certain date or you risk foreclosure.

“Okay, so I’m not going to abuse the loan. What are my priorities?”

I’m of the solid belief that, if you have any outstanding bad debt, it should be the first item you invest money in. It’s pretty simple: If you can get a home equity loan at 5.5% to pay off credit cards that are charging 22%, then you’ll be way ahead of the game.

The next priority would be to invest the money; in securities, a business, or any other kind of investment vehicle. However, you must assess your risk-to-reward and remember that the money you’re “playing with” is on loan and has to be paid back.

Another priority might be an expense that has to be paid: a massive home repair, the purchase of a vehicle as a necessity, or covering the cost of living while out of work are just three that come to mind.

But once you’ve decided to get a home equity loan, remember to shop around for the best interest rate. A great place to start is bankrate.com.

But always remember that the money you get from your home via a home equity loan is not your money. You will pay interest and you will have to pay it back.

Sincerely,
Adrian Newman
Founder, e-Wealth Daily
http://www.ewealthdaily.com

About e-Wealth Daily

The e-Wealth Daily Bulletin brings you daily tips, advice and breaking news related to home businesses, small businesses and internet marketing. Our team of experts gives you the information you need to take your business pursuits to the most profitable level. Founded by Adrian Newman in 2003, the e-Wealth Daily Bulletin andwww.ewealthdaily.com are a division of Lombardi Publishing with online newsletters reaching over 100,000 subscribers each month.

* IMNewsWatch would like to thank e-Wealth Daily for granting permission to reprint this article.

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