Borrowing Against Your Home (aka, Reverse Mortgages) Borrowing from Pessimists

Borrowing Against Your Home for College

When preparing for college, think twice before borrowing against your home or retirement accounts. Parents who do not qualify for a tax deduction on loans for higher education may want to consider using a home equity loan if they qualify for a tax break on the interest. But remember, a home loan puts your house at risk. Another option is to borrow from your retirement savings, but most investment advisers recommend against that approach because it may reduce your future earnings and make it tougher for you to retire when you want.
"Given the many ways to borrow for college at competitive interest rates, ask yourself if you really want to put your house at risk with a home equity loan or reduce your hard-earned retirement savings just to pay tuition," said Kirk Daniels, a supervisor in the FDIC's consumer affairs section.