Heres my question-I recently received a $9K gift. It just so happens I am doing some home repairs immediately that will equal about $9 or $10K. These must be done. I need a new roof right away which is about $5K and the other necessary repairs will be another $5K. I can use that gift to pay for these repairs and its done. However I am also $19K in credit card debt at 8.24% APR purchases and $1K credit card debt on cash advances at 19%.
Should I use the entire gift to pay down the credit card to $11K and then get a home equity for the $10K in home repairs I believe is at 3.74 or 4%? What do you think?? What is my smartest move?
If you don’t have any money in a savings account to fall back on in case of emergencies then I think you should use half the gift money to reduce your credit card debt, save half and get a home equity loan for the home repairs.
You can always contact your credit card company and ask if there is a process to specifically apply $1,000 to the cash advance, I doubt there is. Generally balances are reduced on credit cards with the lowest interest being paid off first.
Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.
P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.