Interesting… so while contemplating on how I should finance my new car, I started to do research on the best method. Originally my 2 options were:<\/p>\n
However, I’ve been looking at HELOC<\/a> (home equity line of credit) and it’s looking more and more like the correct action to take. One thing that does have me a bit worried is that HELOCs are variable rate, but according to MarketWatch<\/a>, the current HELOC interest rate is around 3.25% (is it me or is that exceptionally low?). I’ll need to discuss this further with my dad and Derek as they know a lot more about HELOCs than I do.<\/p>\n Even if the interest goes up to 7%, there’s a huge benefit in using HELOC to finance my car and that’s because the interest is tax deductible. According to BankRate.com<\/a>:<\/p>\n When you refinance acquisition debt or take out additional debt such as a HELOC<\/strong>, you can deduct the interest on such debt if<\/strong> you use it to improve your residence and on up to an additional $100,000 that you can use for any purpose<\/strong>, except for the purchase of tax-exempt securities such as municipal bonds. If you use the $100,000 to buy a second home, then it gets thrown back into the $1 million pot.<\/p><\/blockquote>\n Maybe when I bring this up with my dad and Derek, they’ll knock me on my head and call me stupid for thinking up such a stupid scheme. But so far, it feels like a sound plan. I wonder if I have enough money in my house yet to cover the whole purchase.<\/p>\n","protected":false},"excerpt":{"rendered":" Interesting… so while contemplating on how I should finance my new car, I started to do research on the best method. Originally my 2 options were: Sell stock and buy the car outright Make a small down payment and finance the car at $400-600\/mo for 60 months (at ~6.6% interest rate) However, I’ve been looking … <\/p>\n