Not anymore but that certainly isn’t by choice.  It is hard to get cash out of your home due to the amount of equity that is required in a home.  For a regular Conventional loan you typically can’t go above 80% loan to value (have to have 20% equity) and with a home equity line of credit it is around 70% loan to value. 

Taking equity out of your home for remodeling, improvements, investments, and paying down debt can be okay depending on how it’s used with each.  Just as I recently posted, renovations aren’t adding value to homes as much as they used to.  You don’t want to invest the equity into something risky, always consult a financial planner.  And when it comes to paying down debt you need to make sure it’s really saving you as much money as you think since your new payment is most likely based on 30 years. 

I think banks should somehow restrict how the money is used.  I am not sure exactly how you do that but for instance if someone is paying off credit card debt they should require the borrower to sign something at closing that will be sent to the credit card company with the payment stating they are closing the credit card account.  We just don’t have self-control and if that credit card is still open there is a good chance that you will use it again. 

The bottom line is be careful what you use this money for from your home. 

http://www.cnbc.com/id/34592393 

Most people have credit card debt for one simple reason: they spend more than they earn. However, there are other reasons why you might have credit card debt, such as a medical emergency, a one-time emergency expense, rising costs, or impulse control. No matter how you got into debt, there’s a solution. Review the situations below to find the right credit card debt solutions for you.

Overspending
If you spend more than you earn, the first step is discovering why. It could be because your mortgage has recently shot up, leaving you with little money for other expenses. It could also be because you make a lot of impulse purchases on your credit card. If you have high fixed costs, you should consider scaling back on luxuries like cable television, movie rentals, and eating out. If you spend too much because you like to buy stuff, then you need to learn to ask yourself if it’s something you really need. Wait two weeks before making any purchase. Chances are you won’t really want it anymore. Once you control your spending, you’ll have an easier time paying off credit card debt.

Large One-Time Expenses
If you have credit card debt because of a large one-time emergency like car repairs, your first goal is to pay off that bill as quickly as you can by reducing spending in other areas. Once that’s done, use the extra money to build an emergency fund. Tap the fund for true emergencies, like car repairs or emergency room visits, so you don’t have to go into debt again.

Extended Medical Emergency or Illness
If your family is experiencing a major medical emergency or long-term illness, sometimes credit card debt is the only way to get by, especially if the primary earner is the one who is sick. In this case, your best bet is to negotiate with the doctor or hospital to reduce the medical bills. If the bills are more than you can ever reasonably pay, you may have to consider bankruptcy. Medical bills are the reason for 50% of all bankruptcy filings.

Extended Job Loss or Other Financial Hardship
Many people find themselves relying on credit cards to pay basic expenses after they lose their jobs. If you’re one of them, your first step should be to reduce every possible expense. Cancel cable, cut back on clothing and food purchases, don’t take vacations, do whatever it takes to cut your spending. If you have student loans, apply for forbearance. If you have a mortgage, find out if your lender can also extend a temporary forbearance. If you still can’t pay off your credit cards, consider contacting a credit counseling service for help. They’ll review your finances and may recommend a debt management plan, debt negotiation, or bankruptcy.

Once you get back on your feet, dedicate as much money as you can to debt repayment. You should also establish an emergency fund and continue to spend wisely so that you never find yourself deep in debt again.

Debt Reduction

Freedom Debt Relief Review

Freedom Debt Relief is a group about 500 employees strong and growing – known internally as “The Freedom Family”. We’re energetic, smart & compassionate – but most importantly we’re all about helping our customers through a tough financial time in their lives. We were founded in 2002 by Stanford Business School graduates Andrew Housser and Brad Stroh and since then we have built the best management team around. Freedom works out of three offices in San Mateo, CA., Sacramento, CA., and Phoenix, AZ. Our customers, 30,000 and growing, are spread widely across the United States

Credit Counseling

Consumer Credit Counseling is an alternative for consumers experiencing financial difficulties and unable to make their minimum payments. Like Freedom Debt Relief’s program, Consumer Credit Counseling organizations act as an intermediary between you and your creditors. But Consumer Credit Counseling organizations typically attempt to reduce interest rate and fees on your debts, not the balances themselves. Through the reduction of fees and interest, Credit Counseling will generally allow you to get out of debt in about five years. However, you will end up paying back 100% of your balance plus interest, which will require a significantly higher monthly obligation than a typical debt negotiation program.

When evaluating Consumer Credit Counseling, check to see is if the organization is for profit or non-profit company. Non-profit Consumer Credit Counseling organizations are funded and supported by the credit card companies who you are making the payments to. This does create a potential conflict of interest, so be sure to understand if any Consumer Credit Counseling organization is collecting fees from both you and your creditors.

Consumer Credit Counseling organizations are right for some people, especially those who can afford the higher monthly obligation that is required in such a program. We have relationships with several leading organizations and will be happy to provide their information to you if that is what you decide is best for your situation.