Question:

Should I pay off HELOC (home equity line of credit) first?

Answer:

You could pay off HELOC (home equity line of credit) even early in the draw period. Although during the draw period only interest is required to pay, paying towards the principal is usually possible and recommended. Some people use a HELOC as an emergency fund, but they also stick to another emergency fund, as well.

If you have other debts, as you probably do, you will need a tax advisor to calculate which debt is better to pay off, since your income and your spouse's income will influence the level of tax deductibility. Paying off your HELOC first almost only makes sense if you have government backed debt as student loans.

The income of your spouse is also considered towards tax deductibility, and you should really try talking to a tax advisor when deciding whether to pay off heloc (home equity line of credit) first.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
Was this Mortgage QnA helpful?
Not at all
  • Currently 3/5 Stars
  • 1
  • 2
  • 3
  • 4
  • 5
Definitely
Add to this Answer

Mortgage QnA is not a common forum. We have special rules:

  • Post no questions here. To ask a question, click the Ask a Question link
  • We will not publish answers that include any form of advertising
  • Add your answer only if it will contrubute to the quality of this Mortgage QnA and help future readers
If you have trouble reading the code, click on the code itself to generate a new random code. Verification Code Above:
Bookmark and share this QnA: