Debt Consolidation Loans

Rolling High Interest Debt into Easy Payments

Debt consolidation involves acquiring one loan to pay off several debts. More often than not, the reason for this method of debt control is at least partially because a lower interest rate can be secured.

Debt consolidation can be accomplished by going from several unsecured debts to one bigger unsecured debt, but it usually incorporates a new, secured loan against a house or property. Since a house or other asset is being used as collateral, a lower interest rate can be secured.

Eliminate High Interest/Credit Card Debt

One of the most common debt consolidation scenarios would be somebody who owes a lot of money to several debtors, often including high-interest credit cards, who then takes out a loan against his mortgage to pay off the high-interest debt. The new loan is a type of equity loan, and it carries a much smaller interest rate.

The main benefits of consolidating debt in this fashion are:

In most cases a lower interest rate can be assumed

Eliminate multiple monthly payments due at different times to several different debtors

Wipe out credit card debt which can affect your credit rating, depending on your credit-used to credit-available ratio

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Home Buying Vocabulary

First Mortgage

A real estate loan that creates a primary lien against real property.

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Frequently Asked Question

What sort of down payment might I need to buy a home?

Answer:
Every lender offers different loan programs, but you are likely to find numerous down payment options regardless of which lender you choose. It is relatively easy to find loan programs which offer little or no money down, depending on the type of loan and your financial profile.

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