With rates still on the rise, a big question for variable-rate HELOC borrowers remains whether or not they should to shift to a fixed rate home equity loan. We’ve discussed in previous posts the factors that need to be considered: Stategies for Rising Rates and Pay Off HELOC at 7%?

But here’s a personal case study from Lisa at Contentment is Wealth that may shed additional light on things to look (out) for. Lisa obviously did her homework and uncovered several pitfalls that makes her conclude that the upfront costs of refinancing outweigh the interest rate advantage. An interesting read - both the post itself and the comments.

My only additional thoughts are:

• I wonder if Lisa checked into credit union offerings? I suspect she could easily find more attractive home equity loan closing costs and terms than those offered by her current lender,
• I think Chris (comment #8) has it right. Prudent and careful use of low-rate credit credit card balance transfer offers can be a great way to pare back rising HELOC costs. But this is a strategy you need to stay on top of. Keep the HELOC open in case you get tripped up by one the credit card company “gotchas” and need to quickly write a check to pay off the balance.

Technorati Tags: HELOC, fixed rate home equity loan, refinancing, home equity loan, closing costs, credit credit card balance transfer