Loan Interest May Not Be Tax-free in Your State

If you are considering a home equity loan (you are a brave one I must say!!) you are probably hoping that you can save tax on the interest you pay for the loan. In most cases, this would be the case. However, there are some states in which home equity loan interest is not tax deductible. So, it is important for you to check out the rules and regulations in your area before you sign up for the loan.

Another thing you need to watch out for are fees, charges and other extra costs that may be attached to your loan. Paying lots of points and fees could mean that you're not saving as much as you think with your home equity loan. Agreed, a home equity loan can be a smart way to consolidate debt, make sure you carefully research your decision--and weigh the pros and cons--before signing on the dotted line.