How Can I Pay Off My Home Equity Line of Credit Faster?

It can take years to pay off your home equity line of credit if you choose to only make the minimum payments. You can pay off your home equity line of credit much faster if you set up a plan to pay more than the minimum and stick to it. A home equity loan is a line of credit attached to your home. If you are unable to make payments, the bank can take your home in order to pay your bills. It is important to make paying off your home equity loan a priority.

Instructions

1

Stop using the home equity loan. If you continue adding money to amount you currently owe, it will take you much longer to pay off the loan.

2

Create a budget. Include all of your bills and expenses. Creating a budget makes it easier to find areas to cut so you can find extra money to put towards the home equity loan. Make sure your expenses are less than your income.

3

Cut back on entertainment costs and unnecessary expenditures to find money to put towards your home equity loan. Try to find an extra $200 or $300 to put towards the monthly payments in addition to your minimum payments. The more you pay each month, the more quickly you will pay off the loan.

4

Apply bonuses and your tax refund towards your home equity loan when you receive them. These extra one-time payments reduce the amount of interest that accumulates and can speed up the time it takes to pay off the loan.

5

Sell items to raise extra money to put towards your home equity loan. A yard sale can raise quite a bit of money if you sort through the things you no longer need in your home. You can also sell items on eBay and Craigslist. If your loan if large, you may consider selling big ticket items such as your boat or other high end items to raise money.