One of the biggest problems with any scheme to pay off credit cards by using more credit is most people do NOT change their spending habits. The average consumer will take out a home equity loan to pay off outstanding balances and then only 2 or 3 years later find themselves with a home equity loan and credit cards at their max again. That doesn't solve the problem; it makes it worse. Plus there is the potential to lose you home if you fail to make payments on the home equity loan. In my humble opinion, this is not the best solution to your problem unless you and your significant other make some changes in your spending habits. Switching from one low/no interest credit card can be very damaging to your credit score. One of the components of a credit score is how long your current accounts have been open. Longer is better. New credit cards every 6 months will lower your score which means you pay higher rates or cannot qualify for those "teaser" rates. Also, be aware that the teaser rates will escalate very rapidly if you are ever late with a payment. The solution that I suggest to the personal financial management classses I teach is to stop using credit cards for any daily expenses. Save them for emergencies (a death in the family, an earthquake destroys your house, a hurricane is coming and you have to evacuate). Concentrate on paying off one card by paying extra on that card every month but continue to make the minimum payments on every card you have. When that card is paid off, apply that payment to the next card until it is paid off. If you have trouble avoiding temptation with credit cards, put them in a ziplock bag and seal it. Put that bag in another bag and fill it with water. Put both bags in the freezer and leave it there. Anytime you need a card it is available, but you have to wait to thaw it out to use it which means you have time to think about whether or not you really, really NEED what you plan to purchase with credit. While it sounds "dorky" and simplistic, it does work. Good luck

>>In each case, I would have been much better off to invest when everyone was pulling out. Much better off. Absolutely. It's the "sheep", or if you prefer, the "lemmings" mentality that affects way too many people. One good way to counteract that: realize that anytime the media is screaming Financial Disaster, that the old saw will apply yet again - "This too, shall pass." OJ's suggestion is actually quite a good one. It uses dollar-cost averaging which is to your benefit, especially if you have a 10-20 yr timeline before pulling those funds out. One note, BTW - ANY bank can set up electronic funds transfers to your stockbroker, insofar as I know. It's called an ACH form and the only requirement is that it must be done in the same amount, each transaction. The transactions can be weekly, monthly, quarterly or even annually - just as long as they can be set up once and not changed. To change an ACH, one has to resubmit new forms each time, so this is why the transactions need to be "automatic." However, since you are leaning towards the idea of investing in RE, I would strongly urge you to at least maximize your retirement contributions. Yes, you may miss the absolute bottom of the RE market by a few months (since maximizing your retirement contributions may slow down your cash savings plan), but you NEED that diversification. You will be tying up a considerable chunk of net worth in very illiquid RE, which is rather like owning a huge bond allocation. As you have seen, the return on money market funds and even TIPS has dropped considerably. At this point they are hardly keeping their eyebrows above the inflation rate. Use your own psychology against yourself - since you recognize that you are a bigger risk-taker in your retirement accounts, diversify that portfolio with at least an 80% equity spread, across at least five sectors of the market. Maximizing your contributions will allow you a diversified base for your total net worth, which is in the end even more important than just paying off one mortgage (or even two!).

New bank does construction loans all the time and approved us even if the loan to value goes above the 80% as our finances are all sound. They understood contingencies, overruns, etc, and will actually be doing $600k so there’s a little bit of buffer. Spoke with the initial bank rep and bank manager today to close out the loan and they both apologized, with rep even saying they were a little worried about other things that may pop up down the road if this had already started with first disbursement - so I think we may have actually avoided a train wreck down the road.

The reason you're shocked may be the loan officer's lack of familiarity with the const loan process or just wishful thinking. Construction loans are typically maxed at the lesser of 75-80% loan to cost and 80-90 % loan to value inclusive of all costs. Once completed the lender must sell your loan as "conforming". DIY & owner builder projects often require more equity or reserves due to risk. You may qualify for a higher amount via income; however your property valued at completion isn't worth enough in their opinion to secure that amount. Two different issues. Generally over time as the lot loan ("land contract") gets paid down you will gain equity in the project that usually makes it the numbers and ratios work. If a few high dollar new homes get built in the mean time your values also may get a boost, helping ratios. From 95-05 this wasn't much of an issue as values rose quickly creating instant equity, but that is not the case since. Bottom line, the bank will only lend a percentage of market value. If you need more cash, you have to generate it elsewhere and/or secure it on other assets. Some of my clients wait and save for a year or two.