Walking around with at least some level of credit card debt has become relatively normal in today’s society. The average American has thousands of dollars in revolving debt to their name, much of which is accompanied by a two-digit interest rate… and those numbers seem to grow higher each year.
As a homeowner, you are likely to build up equity in your home over time as you pay down your mortgage loan and if market home values increase. This equity — calculated as the difference between what your home is worth and how much you still owe on the property — is a valuable asset that you will enjoy when you eventually sell your property.
According to a recent poll, Americans said that taking out too much money in student loans was the financial mistake that took them the longest to recover from. And with student loans taking an average of 18.5 years to repay, this is no big surprise.
An unauthorized charge. A new credit card or loan that you don’t remember applying for. Hard inquiries that show up on your credit report unexpectedly, even though you haven’t been shopping around for credit.
Home values have been rising at unprecedented rates the past couple of years. In fact, according to recent data, the average homeowner is now sitting on about $186,000 in available home equity — the highest average ever on record. Most homeowners leave this equity alone until it’s time to sell their home, but that value can represent a significant financial asset and make up a notable portion of their overall net worth.
Credit cards and line of credit accounts are similar revolving credit-based products. They both offer consumers access to necessary funds, whether for daily spending or a big, one-off purchase.
When it comes to consumer lending products, there are many options available online with a variety of use cases. For those in need of access to cash that isn’t tied to one specific use (e.g., an auto loan or student loan), there are two main avenues to take that, while somewhat similar, differ in several key aspects. They are a personal line of credit and a personal loan.
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