[Christien]

That sounds like a great idea. Basically, you're using your home equity as your main savings account, rather than letting savings build up in an account which, as you say, doesn't really earn anything. Whatever's left over at the end of the month goes to knock down your debt. So long as you earn more than you spend (and you're responsible about it), you're in good shape. Plus, if something comes up you've got quick access to lots of cash, which is always nice.

The only downside I can see to it is the argument that money tied up in a house is money that isn't working. There's a good argument that you'd be better off with an interest-only mortgage and the money that would be building equity earning 10% somewhere else. But then I also like the security that home equity brings.