A Line Of Credit,

Is The most flexible loan facility you can have!

But does that mean a Line Of Credit

is the Right loan for YOU?

Here Are The Pros and Cons Of Line Of Credit Loans:

The “Pro’s”;

• Easy access to the equity in your home.
• Can easily reduce or eliminate repayments in tough times.
• Can easily increase payments when the times are good.
• Can redraw your extra payments with no penalties.
• If managed well you will pay off your home loan sooner.

The “Con’s”;

• On the other hand the flexibility of a line of credit can result in a loan balance that over time is only marginally reduced or even worse does not reduce at all.

This may actually not be a bad result provided the loan is being redrawn for the purpose of accruing additional assets.

By assets I mean income producing assets like shares and property, NOT cars and boats.

So should you have a line of credit loan?

The answer is really quite simple. If you think about a line of credit loan as one big credit card, then you will very quickly answer that question for yourself.

Here are some general guidelines;
1.If you have credit cards and you find it very easy to use them AND pay them off IN FULL every month, then you will most likely benefit greatly from having a line of credit loan.

2.If you have credit cards and mostly pay them off every month but on occasion use them to buy a big ticket item, or fund a holiday, and then clear that extra expense over the course of a few months, then you too will most likely get very good benefits from a line of credit.

3.However if you have a credit card or cards, and they always seem to be floating around the maximum limit, then if you had a line of credit home loan, there is a good chance you will end up in the same situation, and that is not a happy result!

These are only guidelines. If you fit into one of the first 2 categories above and still have concerns, you can contact me at 4steveroberts@gmal.com, and I will be happy to go into more detail with you at a personal level.

Similarly if you fit into the 3rd category but feel strongly that you are ready to use the flexibility of a line of credit to your benefit, or to find out what other options might work better, I would be only to happy to discuss your individual circumstances.

I hope this article has been of assistance, and don’t forget to get your free copy of “7 Tips On How To Wipe 5 Years off Your Home Loan!”, Fill in your email address below and I will send it to you;