Those who have taken home equity loans should keep a close watch on them
. This is especially true in case you have a variable or adjustable rate loan or if you are considering an early loan pay-off. Check the fine print for prepayment clauses. In case you decide not to prepay and keep your second mortgage open, try to reduce the outstanding balance by applying any extra income to the principal amount. In this way you can manage your payments better and avoid unnecessary outflows on high interest rates.