NKS Monthly

Tips for Smart Borrowing on a Home Equity Line of Credit

A Home Equity Line of Credit is a credit line secured by the equity in your home. You can use a HELOC to provide cash as needed for a purchasing a rental property, home improvement, bill consolidation, vacation, school tuition or whatever else you like. There is a pre-set limit and you can write yourself a check whenever you need it. Payments are determined only on the amount of funds that are owed.

A home can be a good way to build long-term wealth but be aware of what the risks are when borrowing against your equity. Be particularly wary of using home equity to pay off consumer debt. You may end up deeper in debt in the long run. In general, you don’t want the term of your loan to last longer than what you’ve purchased. For example, if you use a HELOC to buy a car, try to pay off the balance in a few years and definitely before you trade in for a new vehicle.

It is important to know what the tax rules are when it comes to HELOCs. The tax deductibility really depends on what you used the HELOC monies for. The tax break is limited to interest on loan amounts of $100,000 or less. You need to consult your accountant about the tax rules regarding your specific situation.

We have HELOCs available up to 90% of the value of your home. There is no cost to the borrower to do them. You may have a minimal recording fee and an annual fee on your credit line.

For more information on Home Equity Lines of Credit and how it may be beneficial to you contact my office. There are a lot of banks that are limiting availability of HELOCs, so this might be a good option for having available money now. Remember, there is NO FEES to do a HELOC!

Back to School

Cool clothes, the right backpack, lunch box, notebook, calculator and more. In recent studies the National average cost to prepare your offspring for the fall migration back to school is nearly $600.

The most valuable gift you can give your school-bound children, however, doesn’t cost a cent – it’s your enthusiastic partnership in their education! Research studies have shown time and again that excellence in student achievement is closely linked to active parent participation.

Parents make a difference. Children of involved parents have better grades, better attitudes and better behavior.

o Develop a relationship with your child’s teacher. Volunteer in the classroom or go on field trips. Don’t miss Back to School Night or teacher conferences.

o Instill a love of reading. Have good books available for your children at every age.

o Limit TV and video games.

o Know your child. If you suspect a learning disability, take advantage of the vast resources available.

o Be available. Talk frankly to your children about the values you want for them.

You are the first and most important teacher your child will ever have. Don’t underestimate the value of your contribution. From kindergarten to college “back to school” is filled with emotion. Acknowledge the jumble of emotions your child may be experiencing and reassure them that today’s unknowns are tomorrow’s routines.