Home equity loan vs. HELOC: Which option is right for your credit card payoff plan?

If you're going to pay off credit card debt with home equity, make sure to choose your borrowing option wisely. Pramote Polyamate/Getty Images Credit cards are rarely a low-cost way to borrow money, but if you're carrying a revolving balance from month to month, you're likely aware of how increasingly difficult it is to manage right now. With average credit card interest rates still sitting above 21% and inflation continuing to strain people's budgets, many borrowers are finding that their monthly payments aren't making much of a dent in what they owe. When that happens, what might have been a temporary balance can quickly become a long-term financial challenge. At the same time, homeowners remain in a relatively unique position in today's economic landscape. Despite elevated mortgage rates and a slower housing market, many homeowners have made substantial strides in terms of their home equity over the last several years, thanks, in large part, to strong home price appreciation. That has created an opportunity to access lower-cost borrowing options that aren't available to renters or those without significant assets. For homeowners looking to escape high-rate credit card debt, tapping home equity can be a logical next step. There are multiple ways to do it, though, and the choice you make could affect everything from your monthly payment to your overall borrowing costs. …