Should we pay off our HELOC with savings?

[Anonymous]

We got a $100,000 HELOC to put an addition on our house six years ago. It is down to around $40k now and we have this amount in savings. We would still have a nice emergency fund, so it wouldn't depleat our savings. The interest on this $170 per month.

Any reason not to pay it off?

[Anonymous]

Anonymous wrote:We got a $100,000 HELOC to put an addition on our house six years ago. It is down to around $40k now and we have this amount in savings. We would still have a nice emergency fund, so it wouldn't depleat our savings. The interest on this $170 per month.

Any reason not to pay it off?

You have paid $12,240 to use 60k. That's 20% in finance charges. Of course you should pay this off. It is foolish to have that loan so long in the first place.

[Anonymous]

I def would. If you need money for whatever reasons heloc is still there.

[Anonymous]

Yes! I'm paying mine off. If I had it in savings, I would not hesitate. We only have part of it, so we've paid it down, kept some in emergency funds and will pay extra towards it to finish it off early.

Go find one of those calculators and see for yourself. I like this one below because you can add in a large 1 time payment and see how much it will save you too.

https://www.free-online-calculator-use.com/extra-payment-mortgage-calculator.html

[Anonymous]

Yes, but just to confirm what is the interest rate you are paying on the loan vs the interest rate you are getting on the savings?

[Anonymous]

Anonymous wrote:Yes, but just to confirm what is the interest rate you are paying on the loan vs the interest rate you are getting on the savings?

The bank makes it difficult to find the interest rate on the loan. I found it using the mobile app. It is 5% I know that my savings is not making any where near as much as I am paying in interest for the loan.

I am going to pay it off.

[Anonymous]

Anonymous wrote:I def would. If you need money for whatever reasons heloc is still there.

The OP is not the kind of person who should have access to credit. She needs Dave Ramsey.

[Anonymous]

Anonymous wrote:Yes, but just to confirm what is the interest rate you are paying on the loan vs the interest rate you are getting on the savings?

LOL! Cute

[Anonymous]

Do you have any other debt that costs more than your monthly payment on the heloc that you could pay off completely? I would pay that off so you you can free up more cash to go towards savings and then the heloc payoff. 5 percent really isn't that high of a rate.