A home equity loan can be used for anything from paying off high-interest credit card debt, to home improvements to buying a car. The best uses of a home equity loan improve your financial situation, your home or your future and these include debt consolidation, home improvement and education. Your money is invested in something that grows. Poor uses of a home equity loan are to buy a car or to pay for living expenses - the money is spent on something that depreciates or does not create an asset