Home equity loans and equity lines are popular borrowing tools for millions of Americans. Some use the loans to update their kitchens and reinvest in their homes. But others use the money to live a lifestyle they cannot afford on their salaries, buying luxury items like third cars or taking exotic vacations. Some families even use their loans to cover day-to-day expenses as they live beyond their means.

These are dangerous practices. Money counselors advise people to use their equity loans for important investments like a child's college tuition. Try to heed this rule for keeping you and your family financially secure when borrowing against your home: Keep at least 20 percent equity in your house.

Don't let your debts through mortgages, home equity loans, or equity lines reduce that amount.

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