Consolidating debt into mortgage good idea
Thirty years – or even fifteen years – is a long time to deal with credit card debt.
Thirdly, adding additional monies onto your mortgage balance lessens the cushion of equity you have in your home.
When you’re struggling with debt, it’s easy to go for the solution that will bring you the quickest relief.
Many people choose to refinance their home and roll credit card debt into the new mortgage in order to get the cards paid off and start with a clean slate.
One example of a secured loan is a home equity loan.
If you already own a home and have equity, you can borrow against the equity in your home.
Both of these options are great options for paying debt off quickly.
This will help you avoid the long process of paying off a credit card when you pay only the minimum and pay a higher interest rate.
Companies like Sofi often give loans for interest rates of under 10%, saving borrowers hundreds and thousands of dollars in cash as they pay off their credit cards under a newly consolidated, less expensive loan.
While refinancing your home may seem like a smart move for paying off credit card debt, the other options mentioned above can save you more money, more time and can get you out of debt faster.
When that debt is paid off, you take the minimum payment you were paying on that debt, add it to the minimum payment on the next debt, and throw any additional monies toward the next debt until it is paid off too.
You just keep on at the list in this order until everything is paid off.The debt avalanche works similarly, except for that you start by listing your debts according to interest rate, starting with the highest interest rate and ending with the lowest interest rate.