If you don't improve your spending habits, you could end up accumulating a far worse amount of debt than before.Home Equity for Repairs It is better to save up the money to make cosmetic upgrades and repairs on your home.

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Lenders may not tell you the entire story when you seek to borrow on the equity of your home.

Before you consider taking this step, consider the following information about home equity loans.

The Lure of Consolidation Having multiple credit card and loan payments can seem like a lot to keep track of.

When combined with other debts in an equity loan at a nine percent rate, that same $1,000 will actually cost you a few thousand more dollars in five years.

Even though the interest rate is lower, the extended low payments will cost a lot more in the long run.

There is also the temptation to continue poor spending habits once the bills are consolidated.

Nothing is really paid off, the debt is just moved.

Many times consolidating these bills is an attractive option, because only one monthly payment is required.

There are two problems with using home equity for the consolidation of other debts: interest rates and spending habits.

Over time, depending on the interest rate, you may end up spending a lot more on interest than you would have by paying separate bills.

For example, if you have a ,000 balance on your credit card with an interest rate of 14 percent, you can pay it off in four months for a few hundred dollars.