Home Equity Loan vs. 401(K) Loan –Which should you choose?

Written by Charles Essmeier


You've finally decided to add that patio you've always wanted to your home. Now you can enjoy barbecue outdoors and get a little fresh air every now and again. But how are you going to pay for it? If you're like most people, you don't have cash for home repairs just lying aroundrepparttar house. You'll have to borrow. So where should you go to borrow? Mortgage rates are low these days, so a home equity loan would be pretty affordable, as would a home equity line of credit (HELOC) if you have a number of remodeling projects in mind.

Then it occurs to you -- "What about my 401(K) money? I can get good terms on a 401(K) loan and borrowrepparttar 135526 money from myself!" That seems like a good idea. You can borrowrepparttar 135527 money from yourself and pay yourself back with interest! What could be better than that?.

Onrepparttar 135528 surface, borrowing from your retirement savings may seem like a better idea than taking out a home equity loan. The terms are good either way, andrepparttar 135529 interest rates are probably comparable. So, why not borrow from your 401(K) account?.

There are several reasons why it may not be desirable to borrow from your retirement account:.

  • Most Americans fail to save enough for retirement, so borrowing from your retirement fund may leave you short later should you default. No one wants to be broke when they retire.


    • Why use a loan calculator?

    Written by Jakob Jelling


    Using a loan calculator allows you to seerepparttar true cost of a loan before you actually apply for it. You can calculate such information asrepparttar 135525 amount of money you will have to pay every month. If your monthly payments are too high, you will end up with late payments and bad credit, face high interest accumulation and hounding collectors.

    You can use a mortgage loan calculator to determine your rates. Loan calculators can also be used for auto loans.

    Online loan calculates allow you to see what you will be paying before you actually acquire a loan. You can find many types of loan calculators online. While most of them are free to use, some of them are paid.

    Online loan calculators offer ease and convenience by doingrepparttar 135526 hard work for you. You do not have to be a financial expert to determine how an online loan calculator works and you can use to figure out important values associated with your loans.

    In an online loan calculator, you enterrepparttar 135527 required numbers and clickrepparttar 135528 calculate button.

    Different online loan calculators allow you to compute different values. For example for a home mortgage calculator, you can fill inrepparttar 135529 value ofrepparttar 135530 loan, length ofrepparttar 135531 repayment period andrepparttar 135532 interest rate and figure out your monthly payment amount. A mortgage loan calculator also takes into account compounding interest.

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