If you want to make major renovations, such as remodeling your bathroom, on your home in the New York metro area, it's likely you'll need to get some type of home improvement financing. Even if you have to pay interest on this money, the increased market value of your home will make the initial investment worth it. Many families borrow against the value of their home through a home equity loan or line of credit to update the kitchen, add a room, renovate a bath or finish the basement. This money can be fairly easy to get, especially if you have a good credit rating. But, be careful. There are some serious consequences that can develop if you don't manage a line of credit carefully. Here are some examples:

Balloon payments:
You'll make no principal payments so your monthly payment is manageable. But down the line is a balloon payment. The next thing you know, you're back in even more debt to pay off.

Teaser rates:
If you find an ad in the paper that advertises an unusually low home equity rate, don't sign up too quickly. Many are only good for the first six months of the loan, then the rate rises to a more normal rate.