Certainly one legitimate use would be covering the expense of major emergencies, like a big medical bill, if you don't have sufficient savings. Other appropriate uses include home improvements and education.

Experts believe that the least appropriate use for home equity borrowing would be for unneeded luxuries. This could include an expensive car, rather than basic transportation, or a costly vacation. You should also try to avoid relying on home equity loans to cover basic living expenses except in transitional periods between jobs.

Most importantly, make the decision yourself as to whether you need a home equity loan and, if you decide you do, contact at least three lenders. Be especially wary of uninvited loan offers that you receive through the mail, by telephone, or on your doorstep.