Dear Mary: You recently said using home equity to consolidate credit card debt is a bad idea. What’s wrong with getting a lower interest rate and combining balances? —Jenna Dear Jenna: When dealing with risk, it’s always a good idea to ask yourself what is the worst that could happen? What is the risk? If you stay with your current situation, and for some reason, you default on a credit card balance, here’s what will happen: The creditor will trash your score and possibly sue you for what you owe. But the lender cannot take your house. If you default on the home equity loan, the lender will take your home through foreclosure, no questions asked. Sure, the interest rate will be less than on a credit card account, but the risk is so much greater. Another problem is human nature. Most people who do as you suggest—using their home’s …
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