6 responses so far ↓

• 1 patrick

  Debt consolidation through a mortgage refi is a good idea, for several reasons. First the interest is usually deductible (as long as the new mortgage is not higher than the original cost of the house), and the rate is almost always lower than unsecured debt. It also lowers the total monthly payment, as the amortization term on a refi is 30 years, while most unsecured is amortized over 4 years.
  Make sure you use a reputable broker. Avoid a mortgage that is adjustable. And if possible make extra payments against the principle, to lower your overall debt.

• 2 I_Love_McRedneck

  If you’re at a point where you can’t handle your monthly payments anymore, it could be helpful to do this. The problem is that you’re now paying 30 years for debt that surely would be paid off much sooner than that if not refinanced.
  ALSO, most people charge those credit cards right back up after they refi and pay them off. SO, they’ve just increased your debt actually. BAD IDEA! Cut up all your credit cards and never use them again. It sounds like credit counseling might be a good idea if you’re in that kind of situation.

• 3 Steve B

  Usually you end up paying through the nose to the ‘Consolidation’ company and end up with a high Interest second Mortgage hanging over you for 25 years …

  Unlike Credit Card debt etc. - which is ‘unsecured’ (which means they can’t take you house away, so you can negotiate to freeze interest and lower payments eg. via an IVA), if you fail to pay a Mortgage they WILL take your house ..

  So think very carefully about it ..unless you are 100% sure you can keep paying the Mortgage you might end up loosing your home ..

  PS Please ignore the first response ..
  In UK Interest is NOT ‘deductable’

• 4 sideline2084

  Check out lots of information about mortgages, refiniancing, consolidation, bad credit mortgages and more.

• 5 DAVID M

  I found a useful resource on the web that goes into all the nitty gritty about mortgages. My friend found a good price here.

  Good luck

• 6 benebuck8

  If you can save money (REAL money, not just $50 a month)…then go for it.

  There’s no reason to pay higher interest rate, if you can get it lower on the refinance.

  Plus with the tax deductions, it makes even more sense.