If you have a smaller project - or a great introductory offer, like zero-percent interest for a year - credit cards can be a good option. Scott Bilker, founder of Debtsmart.com, says it's important to be disciplined if you choose to pay by credit card. There are no paperwork needed for established credit lines; also, there is a possibility of cash back or other rewards. However, there is a possibility of high interest rates; variable rates mean you could pay more over time.

Cards from home improvement stores such as The Home Depot and Lowe's can be a good option if you know you can pay off the balance fairly quickly. Cards can only be used at a single chain of stores.

A HELOC, or home equity line of credit, is a bit like a credit card. It's also an increasingly popular option for homeowners. The rates are variable and will typically be higher than the rates you could get on a second mortgage - though likely lower than those of credit cards. If you already have a relationship with the bank offering the line of credit, the bank may waive any fees associated with opening it.

Matt Coffin, founder and president of LowerMyBills.com said that you only pay interest on the amounts you borrow on the HELOC. HELOCs may have lower interest rates than credit cards and offer tax benefits.

A home equity loan is a second mortgage - it offers a fixed rate, like a traditional 30-year mortgage. The rate you'll be offered is typically higher than it would be for a first mortgage or refinance. As with a HELOC, the interest is generally tax-deductible.

A home equity loan is less complicated than a full refinance, less expensive than a line of credit and can offer tax benefits.

By Mabelle Sese
http://realestatepress.org