There are several benefits to paying off your credit cards with a home equity line of credit.

First: you can take advantage of recent prime rate reductions for an interest rate significantly lower than those offered by most credit cards. Apply your savings to your bill and you’ll be able to save money while paying off cards faster.

Second: you may be able to improve your FICO credit score when you transfer the debt to your home equity line. How your score is affected depends on whether your HELOC is listed as a mortgage or installment loan.

This strategy can save you a lot of money. However, it is important to use caution: unlike your credit cards, your home equity line is secured by your property. If you cannot pay back your HELOC, you could lose your home.

Learn More: Will Paying Off Credit Cards With a HELOC Improve My Credit Score?

Tags | credit score, FICO score, Heloc, home equity line of credit