Use his “equity” to pay off his credit card debt

How would we function without them? They make our life easier. Thanks to them we are recognized and people trust us. Also abroad. No wonder we use them often, sometimes even a little too much. I am of course referring to our faithful companions, credit cards.

• Also read: Can it be advantageous to open your mortgage before it is due?

Unfortunately, one day a painful situation may arise. Payment dates that always come a little too quickly are you financially choking? If yes, what to do?

Should I use the value of my home (“equity”) to pay off my debt, you ask? Although it is common to do so, the answer to this question requires thought. First, let’s look at how fairness is assessed and what it costs to use it.

About “Justice”

Your home has increased in value over time. In addition, you have repaid part of the capital that was originally borrowed. That is what “equity” means. It is calculated as follows:

  • Market Value of Property – Mortgage Balance = Equity.

Refinancing your home or taking out a home equity line of credit usually gives you access to 80% of the market value – mortgage balance to pay off your credit cards or invest in an apartment building.

However, you will lose some feathers in the process:

  • Appraisal fees to determine the market value of the home if you want to get the maximum value.
  • Notary fees if your loan does not allow you to reborrow at initial value.
  • Bank charges for prepayment. However, the institution may decide not to charge you any fees.

Is it worth the cost? Do the math.

Before you act

I suggest you think about your behavior as a consumer. Because equity is not a bottomless pit from which you can constantly draw sums to get out of trouble.

In general, it is used to carry out a new project, to make an investment such as buying a rental property, to help a loved one to carry out urgent work … If you use it constantly to pay your credit cards and not limit your consumption , your equity will melt like snow in the sun.


Difficulties with credit card payments can be symptomatic of overspending.

Does it repeat? If so, the question arises: Are you living beyond your means? Of course, you can pay off your credit cards with your equity. No problem. But maybe you should think about reducing your consumption. Or at least plan better. Because if you plug a breach while the boat is leaking from all sides, you’ll be back in the water in no time.


  • Use your financial institution’s free financial planning services.
  • If necessary, put away your credit cards for a while so as not to use them.

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