I am one of the many senior citizens who lost their retirement savings in the market last fall. I have a 15K draw on my HELOC and came in on a promotional 0.5% below prime. I am presently paying interest only at 2.75% (about $40 monthly). I have until this Friday to lock in a fixed rate at 4.99% to repay both interest and principal over a 15-year period (about $115 monthly). I am 62 years old, do not yet receive Social Security and only make about 25K per year. I am not facing foreclosure (yet) but still owe a lot on my home and am trying desperately to hold off selling until the market turns more in my favor. I know no-one has a crystal ball but I am very ignorant of financial matters and have no-one to advise me. Any feedback, opinions or recommendations would be greatly appreciated. Thank you.

As you said, I do not have a crystal ball. But I will give you my opinion.

I am relatively certain that your payment will go up even if you do nothing. Your promotional rate appears to be close to an interest only loan. I ran the numbers for your current terms through a financial calculator and the result indicates that even at 2.75% your payment should be around $101.

Your bank should be able to confirm that. And also give you an estimate of what your payment will be at today's interest rate if you do not lock in the 4.99% rate. Ask for an appointment with the loan officer and politely insist on more information and clarity.

Also, on a longer term think about the worst case scenario. What will happen in five years if interest rates go up 3 or 4 points? Would you be able to make the payment? And I fully expect interest rates will go up, the only question is when and how much.