I would like to ask some specific questions with regards to debt consolidation. I am currently in the hocker with tons of consumer debt (Credit Card). This of course is making it tough to save like I would liketoo and invest in my families future. 1) My first question is regarding the 125% loans that are being offered. I am considering taking a 110% home equity loan to consolidate around 32,000. I have mixed feelings with regards to this type of loan. I do feel this will help my position in that I will be able to write off the interest paid on this loan with regard to income taxes. The down fall is messing with the equity in my house. ( Of course I will get getting rid of those high interest rate credit cards and revolving credit accounts.) And feel I should be able to pay off this debt quicker than if I keep going the way I am paying the min payments on the Credit cards because of the overall savings in the monthly payments. ( by applying the extra $$ to paying the debt off quicker. 2) I also heard that you suggest to paying off you debt instead of investing in 401k plans. Currently I am putting money in to a 401K plan in which the company is matching my investment. Please help me understand why I should stop investing in the 401k tax deferred account and begin to pay off the debt I have generated. I am making a good return on my money in this account. I would appreciate any help you could give to get me back on the right track. I know this is not unrealistic , but just want to make the right decision for my future. Thanks for you response.
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