Home improvements are a good reason for using your home equity to get a loan because following the renovations, your home will be worth more to you and the lender alike. Such an investment usually requires a much larger loan than an average consumer loan you would be able to qualify for if you have bad credit. With education you’re also willing to to use your home equity as leverage if you know this will help you improve your income in the future.

Using such a loan to avoid bankruptcy definitely has it’s benefits as well, as being forced to claim bankruptcy will be highly detrimental to roughly a decade (or more) of your financial well being.

How much you can borrow with a home equity loan depends on two things: how much your home is worth and how much you currently owe on any of your mortgage loans already established. Furthermore, with bad credit lenders are likely to charge you a higher interest rate than if you had excellent credit. Though just because the interest rate will be higher, a home equity loan is still a good option. A interest rate on a home equity loan is typically 4-8% lower than it would be on your credit cards. Also keep in mind that you might be able to get a tax deduction on a home equity loan, and you cannot do so with your credit cards.

Another plus side to the home equity loan is that you can usually take as much time as you need to pay it off. Lenders are in the business of money, and although you’ll have to agree to a foreclosure (the forced surrendering of your property if you cannot pay back the loan), lenders are much more willing to give you the extra time. They would much rather have you pay back the money you owe on the loan than acquire a property that they have to deal with.

Seek advice from a credit professional to see if this is the solution for you based on your circumstances and your credit. There may be a better option out there for you but discussing your options with a professional will help you figure that out.