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<blockquote data-quote="ILL_INI" data-source="post: 1312279" data-attributes="member: 4851"><p>It wouldn't be a bad idea to have a HELOC for emergencies (you only pay interest on the amount you draw) or to pay down higher interest debt, which it sounds like you do not have, but don't think you can pay off your mortgage faster via a HELOC. The websites that were assuming you have a mortgage with compound interest are probably making a false assumption. Only you, or more likely your lender, would have the answer to that, and if it is simple interest, which I'm 99.9% sure it is, then there would be no difference if the APR were the same. However, with most HELOCs, the rates are variable and higher than a mortgage. You would have to ask your lender about the rates and how the interest is calculated on the HELOC (usually simple), too, to make a comparison.</p></blockquote><p></p>
[QUOTE="ILL_INI, post: 1312279, member: 4851"] It wouldn't be a bad idea to have a HELOC for emergencies (you only pay interest on the amount you draw) or to pay down higher interest debt, which it sounds like you do not have, but don't think you can pay off your mortgage faster via a HELOC. The websites that were assuming you have a mortgage with compound interest are probably making a false assumption. Only you, or more likely your lender, would have the answer to that, and if it is simple interest, which I'm 99.9% sure it is, then there would be no difference if the APR were the same. However, with most HELOCs, the rates are variable and higher than a mortgage. You would have to ask your lender about the rates and how the interest is calculated on the HELOC (usually simple), too, to make a comparison. [/QUOTE]
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