Home equity loans are not for seniors

Are you a retired person who has dispensed of most of his/her debts, your mortgage is almost paid off and you own a beautiful home and have a fixed income? A word of advice: steer clear of home-equity loans. It is indeed tempting to take one of these loans. Imagine the loan you can get by using the equity on your home as a collateral. There are quite a few things you could do with that money – go on a vacation for one. Or even satisfy a simple urge to buy yourself a new car. The problem is that you may be stuck with a loan you cannot repay and then lose the home that you have taken so many pains to acquire.

If you are badly in need of money, for example, you may need to pay major medical bills or make home repairs, instead of a home equity loan you could try a reverse mortgage. With a reverse mortgage, which is another type of loan based on the equity of your home, you don't need an income to qualify, and no principal or interest payments are normally due until you move, sell your home or die.