Best Use of Low Fixed Rate HELOC
Hello Guys, I'm new to BP. I am thinking about taking out HELOC on my primary home to pay off my primary mortgage faster (I will be doing mortgage recast at the same time to lower my monthly payment). Please advise me on how I should go about using HELOC wisely (I'm very responsible with money and have a stable income). Below is my scenario.
Primary Home Market Value = $350,000
Balance Left on Primary Mortgage = $210,000
Primary Mortgage Rate = 3.625%
HELOC Term That I Will Be Signing Soon = Fixed-Rate HELOC @2.75% (valid only upon initial draw at closing) x 5 years.
I'm thinking of initially drawing 30K HELOC at closing so that I can get 2.75% intro rate x 5 years then immediately throw that initial 30K directly to Principal Balance of my primary mortgage then start paying back 30K HELOC as fast as I can.
If you guys have any other ideas/suggestions, please feel free to share. I would love to find out how I can use HELOC wisely.
Thank You!