Yes, it is possible to consolidate all of your debts in one loan. Customarily, this is accomplished with either a second mortgage or a mortgage refinance. Let us look at the pros and cons of a debt consolidation loan.
Debt Consolidation Loan
Many people think first of a debt consolidation loan when seeking debt consolidation. This option typically means a second home loan (or home equity line of credit) or refinancing your primary mortgage. In a debt consolidation loan, you exchange one loan for another. The most frequent form is taking out a mortgage loan, which carries a lower interest rate and is tax deductible, to pay off high interest rate credit card debt.
It is important to be aware that shifting unsecured debt to secured debt can create a volatile situation. If there is ever a chance that you cannot afford the new mortgage payment you are now putting yourself at risk of foreclosure! In the case of a debt consolidation loan, most mortgages are 30-year loans, which means that the total cost and the time to debt freedom could be very high, but the monthly payment will be lower than other options and there is no credit rating impact.
You do have other options, including debt resolution, or credit counseling services, or bankruptcy. Educate yourself about all of your options before fixating on one.
I hope this information helps you Find. Learn & Save.
Best,
Bill
www.bills.com/
March 18, 2010
March 17, 2010
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