Sep 5

The risk of increased interest rates is definitely something to consider for homeowners who have set up a home equity line of credit over an extended period, and in a secondary lien position. This is due to the variable interest rates that HELOCs tend to carry. As well, these rates will increase when bank interest rates do. But the risk of rising rates can be eliminated when a HELOC balance is combined with a cash-out refinance. Doing this will also help the homeowner to avoid the rising monthly payments that accompany increased interest rates from the bank.

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