Why card debt is a common target
Credit card rates are often variable and much higher than mortgage rates. Minimum payments mostly cover interest, so balances can linger for years.
A fixed-rate home equity loan replaces those revolving balances with one set payment and an end date. With CapCenter, you choose a 15-, 20- or 30-year term, and your principal and interest payment stays the same.
From unsecured to secured debt
If you fall behind on a credit card, your credit takes a hit and you may face collections. If you fall behind on a home equity loan, you could lose your home.
That shift is the real trade. Be confident about your income and budget before you make it.
What it can do for your credit
Paying cards down to zero lowers your credit utilization, the share of available credit you're using. That can help your score.
Think before closing paid-off cards. Closing them reduces your available credit and can raise utilization on any card you keep. Many people keep older cards open but stop carrying a balance.
Keep the cards from filling back up
- Build a monthly budget that covers your spending without the cards
- Keep one card for planned purchases you pay in full
- Remove saved card numbers from shopping apps and sites
- Start a small emergency fund so a surprise bill doesn't land on a card
- Pay extra on the home equity loan when you can
Is the balance big enough?
CapCenter home equity loans range from $50,000 to $250,000. If your card balances are smaller, you might combine them with other high-rate debts, or look at a balance transfer or a debt management plan instead.
CapCenter home equity loans come with ZERO Closing Costs (restrictions apply; see Offer details), so less of what you borrow goes to fees.
Questions to ask yourself first
- What caused the balances, and has that changed?
- Can I handle the new payment if my income dips?
- How long would it take to pay the cards off on my own?
- Will I pay this loan off faster than its full term?