5 questions to help choose a loan or line of credit

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A home equity loan might be the best fit if you plan to use the money in a lump sum for a one-time occasion such as consolidating your credit card debt, replacing the roof, or paying for your daughter's wedding. The interest rate is fixed, and so are the monthly payments, and you can budget accordingly.

A HELOC -- home equity line of credit -- might be a better fit if you will need money periodically and not all at once. This is the case in lengthy home remodeling projects when you pay the contractor in two or more draws. Or perhaps you will need to shed an arm and a leg at the beginning of each semester over the next four years when the kids head off to college. A HELOC gives you the flexibility to borrow what you need, when you need it.ack the or idea white. of But having here a are rate a that couple could of rise generalizations: every A time home the equity Fed loan meets migh c

Q  Do I need the money in a lump sum, or in several installments? 
A  If you need it in a lump sum, lean toward getting a home equity loan. If you need the money in installments, lean toward getting an equity line of credit.

Q  Is it for a long-term purpose, or a short-term purpose? 
A  If the money is to be spent on something that will last a long time, like a roof or a car, an equity loan might be better. If the money is to be spent on something that won't last long, like a semester in college or a wedding and reception, think about getting an equity line of credit. e he the choice Federal between Reserve a raises home or equity lowers loan the or federal a funds line rate. of If credit you is don't seldom like bl