Debt consolidation mortgage loans are a great way to lower your monthly payments, and get out of debt once and for all. Whether you have major debt or are just beginning to feel a little squeeze, a debt consolidation mortgage loan can save you money.
Debt consolidation loans can take a variety of forms, terms and options. Common debt consolidation options are cash out refinances, home equity loans, second mortgages and 125 LTV loans. Currently debt consolidation is the leading reason why many people are refinancing today.
Home Equity and Debt Consolidation
Many people don’t understand how home equity can work for them when they need to consolidated their loans. The basics boil down to two things, 1) the difference between what you currently owe on your home and what your home’s is currently worth is the equity in your home; and 2) the equity in your home can be turned into cash to pay off other debts. The way that you access that money is where we come in.
When to Consolidate
If you have large balances on more than one high interest rate credit card, car loans or other high interest debt – you might want to consider a debt consolidation mortgage. A debt consolidation mortgage with an interest rate of 12% is still better than paying 21% on several credit cards. Most often loans for debt consolidation are spread out over 30 years, the monthly payment for the loan would still be lower than the total of all of the individual monthly debt payments.
If you are looking to take money out of your home for a large purchase such as college, a wedding, or some other large purchase, a cash out refinance might be the best solution. If you are still unsure about which loan program is best suited for you, fill out our mortgage quote box and a mortgage specialist will contact you and go over your specific situation
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