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2025-10-09
Personal Finance
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How to Put an End Date on Your Debt

2017-04-24

How to Put an End Date on Your Debt

  • Get a clear payoff date and predictable monthly budget with fixed payments.
  • Improve your financial health and credit score by paying off debt quickly and lowering credit utilization.
  • Get low rates, transparent terms, and personalized service with a home equity loan from Texas Bay.
  • Use your home's equity to consolidate high-interest debts into one monthly payment.
  • Save thousands in interest with fixed home equity loan rates.

You’ve probably been carrying the same debt for years—even decades. And while making the minimum payments may keep short-term costs low each month, failing to lower your credit utilization rate takes a toll on your plans for retirement, remodeling, traveling, improving your credit score, or ultimately freeing yourself from debt.

If you’re looking for a dependable way to get out of debt, consider a home equity loan, which offers set monthly payments, a low interest rate, and a clear timeline for repayment.

What Is a Home Equity Loan?

A home equity loan is a standard, secure loan that many homeowners in Texas use responsibly to alleviate financial stress and improve their long-term economic outlook. It lets you access the value you’ve built in your house as a lump sum payment. It also has a fixed interest rate and repayment terms, making it one of the most reliable debt consolidation options available.

How a Home Equity Loan Helps You Consolidate Debt 

  • Manageable: One Payment Instead of Many
    You can use the lump sum payment from your home equity loan to combine multiple high-interest debts, like credit card balances, into a single monthly payment.
  • Predictable: Fixed Rate, Fixed Term
    With a home equity loan, your payment amount is the same each month for the duration of the loan, which has a set end date. You’ll know exactly how much to budget and exactly when you’ll be debt-free.
  • Low-Rate: Save Money on Interest
    Credit card interest rates average around 23.00% APR*. The interest rate on a home equity loan with Texas Bay Credit Union can range from 5.59% to 18.00% APR, which can save you thousands of dollars in a single year.  

    How much interest would you be paying for a $25,000 loan? Credit cards have 23-24% APR, while you can find home equity loans with 7% APR. That means your minimum monthly payment for a credit card debt of $25,000 would be $625, while one for a home equity loan of the same amount would be $494.30. Paying off that debt from a credit card can take 14-16 years, while you can use a home equity loan's 5-year fixed term to pay off the same debt. For a credit card, this would make the total interest paid at least $18,000 if only minimum payments were made. For a home equity loan, this would be $4,658.26. APR = Annual Percentage Rate Standard variable rate APR of 5.59% to 18.00% based on creditworthiness. Rates current as of 10/01/2025. Payment periods range from 15 to 30 years.

Should I Consider a Home Equity Loan?

A home equity loan may be a good option for you if:

  • You’re carrying multiple high-interest-rate credit card balances and want to lower your monthly payments and interest rates.
  • You want a more manageable monthly budget that comes with predictable fixed payments.
  • You prefer a clear timeline for paying off debt.
  • You’re committed to consistent, on-time payments.

How Texas Bay Credit Union Supports Smart Borrowing

At Texas Bay Credit Union, we’re proud to offer home equity loans that combine low rates, transparent terms, and personalized service. With rates as low as 5.59% APR, compared to credit card rates averaging 23.00% APR, we help Texas homeowners turn their equity into opportunity.

If you’re ready to explore how a home equity loan can benefit your financial future, contact one of our experienced lending specialists today. Let us show you how to leverage the value of your home in a way that aligns with your goals, budget, and peace of mind.

Frequently Asked Questions About Home Equity Loans

Is a home equity loan better than a personal loan for paying off debt?

Usually, yes. Home equity loans typically offer lower interest rates in comparison to personal loans.

Will a home equity loan hurt my credit?

A home equity loan requires a hard credit inquiry, which can temporarily lower your credit score by a few points. However, making on-time payments, especially for debt you’ve consolidated, can improve your credit score over time. Lowering your overall debt at a faster pace will also improve your credit score.

Can I use my home equity loan for business purposes?

Yes. You can use your home equity loan for whatever you need. However, keep in mind that using your home as collateral for business expenses carries more risk than for personal expenses.

Should I get a home equity loan or a HELOC?

It depends on your needs. If you need the entire loan as a lump sum payment, then a home equity loan is the best option. If you’re not sure, then a HELOC (Home Equity Line of Credit) lets you use what you need and only pay interest on the amount you've used. Learn more about both loans here.

Can a home equity loan be deducted from my taxes?

Sometimes. Be sure to consult your tax advisor to find out if your loan is eligible for a tax deduction.

 

*All rates are listed as ANNUAL PERCENTAGE RATE (APR). Certain credit criteria and restrictions apply. Rates current as of 10.01.25. Rates, terms, and conditions subject to change. Credit approval required. Rates can vary by term. Lowest rate is based on your excellent credit history, shortest term available, and maximum relationship product discount. Some Home Equity products may include buy down points to receive as low as rates. Credit card changes require 45 days advance notice.  Texas Bay Credit Union is an Equal Housing and Equal Credit Opportunity Lender. The above rates are subject to change without notice. For current rates and more information, please call the credit union at 713.874.9646.



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