Should you use home equity to pay off credit card debt? Here’s when it can backfire.

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October 22, 2026 / 10:07 AM EDT / CBS News

Credit card debt can be expensive to carry, especially if your cards carry high interest rates that make it difficult to reduce your balance — which is an issue many borrowers are facing right now. If you carry a balance when rates are elevated, a substantial portion of your credit card payment goes toward interest charges rather than the debt itself. But between everyday expenses straining borrowers' budgets in today's inflationary landscape and the many other economic issues that are looming, finding the extra money to accelerate the repayment process isn't necessarily easy.

Homeowners, though, may have another potential source of relief from their high-rate debt: the equity they've accumulated in their homes and other properties. Home values have risen rapidly over the last several years, leaving the average homeowner with a lot of equity, and rather than continuing to pay steep credit card interest charges, they may be able to borrow against that equity at a significantly lower rate and use those funds to pay off their debt. That…

Original source: https://www.cbsnews.com/moneywatch/