I only owe $8,000 on a property worth $400,000
Hi! Thanks for writing! To make sure we are on the same page, let me expand on the question to make sure I understand. You own a piece of property worth $400K on which you’ve paid your loan down to $8K, giving you home equity of $320K. You owe $18K in property tax on it this year, and you are wondering what makes the most financial sense as a method of paying that tax.
I am assuming that this is a yearly tax bill that you need to find at least $18K for every year and that you will continue to need to pay that much or more each year going forward. So this is not an isolated, one-time bill. Since you have equity in your home, you technically could take out a home equity loan to cover the property taxes. The interest rate you would pay would be much less than that on a personal loan or to a credit card company. So in that way, it could work.
The larger concern is the long-term need to pay this yearly bill. If you anticipate that you will need to borrow each year to pay the property taxes, you may want to consider selling the property and buying something with more manageable taxes. You have enough equity in the home to manage paying the taxes for awhile, but using your home as collateral for regular bills is unwise. You could put the property on the market for a fair price and see if you can sell it and make some money.
I hope that things work out for you! Best wishes!