logo
Bad Credit Mortgage Mortgage Calculator Mortgage Companies Mortgage Quote Online Mortgages Second Mortgage Loan
    home | about | contact | sitemap
   


More Information
Second Mortgage
Why Take Out a Second Mortgage?
Traditional Second Mortgage
Home Equity Line of Credit (HELOC)
Preparing Your Credit
Preparing to Apply
Understanding Fixed Rates
Understanding Adjustable Rates
Shopping for a Lender
Locking in a Rate
Understanding Points
High-Interest Debt: A Way Out
Paying for College
Home Renovation
Using the Internet to Research
Payment Comparison
An Affordable Monthly Payment
Private Mortgage Insurance
HELOCs and Monthly Payments
The Role of the Loan Officer
 

High-Interest Debt: A Way Out

With credit so readily available in today’s market, it is no wonder that many consumers find themselves in trouble with their credit card bills. As introductory rates expire and balances balloon, many home owners find themselves unable to make more than the minimum payment each month. This kind of debt elimination strategy is not effective.

Taking out a second mortgage loan can be an effective way to stop having to pay interest rates that can range as high as 15 per cent or more. Many consumers have not just a few, but several high balance, high interest credit card accounts. No one sets out to go into debt, but unfortunately the number of Americans doing so has continued to soar in recent years. While the cause of the problem can probably be attributed to a variety of factors, the solution for many consumers is to take out a lower interest, tax friendly second mortgage.

Taking out a second mortgage loan on your home is a big decision, and not something to be done lightly. But it is not difficult to see the advantage of making one payment at an interest rate of around five per cent or even lower, rather than paying 15 per cent interest on your debt and having to make several monthly minimum balance payments that do not even begin to put a dent in what you owe.

For many consumers, taking out a second mortgage loan as a strategy to deal with high interest debt is also a good idea from a tax standpoint. Though everyone’s situation differs, many consumers are able to deduct the interest costs of their second mortgage loan.