Answers by Gary Napper
Mr. Napper is the webmaster of BuyAndPayHere.Com. Buy Here Pay Here Car Lots

If you are in the market for a vehicle, a home equity loan may be right for you. You should, however, compare the costs of a home equity loan with the rewards. Look for the loan terms that meet your financial needs without undue financial risk. Remember, failure to repay the amounts you've borrowed, plus interest, could mean the loss of your home.  I believe the best use of a home equity loan is for home improvements.  That way the value of your house increase with the amount owed on the house.

If you use your home equity loan to purchase a car and fail to make the payments the lender will foreclose on the house, not repossess the vehicle.

Many of the costs of setting up a home equity line of credit are similar to those you pay when you buy a home. For example:

• Appraisal fee
• Application fee
• Up-front charges, such as points
• Closing costs
  • Fees for attorneys.
  • Title search.
  • Mortgage preparation and filing.
  • Property, title insurance; and taxes.

What's the bottom line. 

• If you have to set up the line of credit the costs may out way the savings.
• Payments on the home equity line are usually for 15 to 20 years, most people keep their vehicles for 36 months.  If you use a home equity loan for a vehicle purchase you could be paying for the vehicle long after it's gone.