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Update: My cash-out refi at 6.5% versus my neighbor's HELOC at 8.2%
We both needed funds for a kitchen reno, but my fixed rate and lower payment clearly won. Anyone else find a refi beats a HELOC for big projects?
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webb.evan6mo ago
Totally agree, locking in that lower fixed rate is a huge win. @ivan597 is right about the variable rates sneaking up on you. My buddy did a HELOC for a bathroom and his payment went up like three times in a year. Watching that happen made me go for a fixed cash-out refi for my own addition, no regrets at all. The payment stays the same and I can actually budget for the life of the loan.
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ivan5976mo ago
Yeah, we went the HELOC route last year for a new deck and I'm kinda kicking myself now. The variable rate jumped on us, and the payment is way higher than we planned. Should have shopped around for a fixed option like you did.
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evan2956mo ago
My uncle always said a variable rate is like a fishing trip where you don't know how big the fish is until you're reeling it in. Your neighbor is holding that 8.2% fish now. Fixed rates give you the peace of mind to plan your life around the payment, not the other way around. Webb.evan's buddy with the bathroom is the perfect example of that stress. It's the same reason I'd rather pay a set fee for my phone bill than get surprised every month. For a big, known cost like a kitchen, locking it in just makes sense.
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