28
May
May
Get out of debt?
I have some debt (credit cards & car loans) that I need to pay off. I own my own home, have a lot of equity in home. What is the smartest way to get out of debt and get some cash in my pocket for a rainy day. Should I 1) refinance my current mortgage, 2) get a home equity loan 3) what are the pros and cons of having an interest only mortgage.
Thanks in advance!!
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Category: Debt Dumper Tips
5 Comments
15:06, 28.05.2010
Interest only loan is not a great choice for your primary mortgage. If you go with a Home Equity Line of Credit (HELOC) you will have interest only options as well.
I would say go with the HELOC. The disadvantage is that there is typically an adjustable rate, in reality, so are your credit cards. For most people, even though "rate" is the most important factor, it is not in reality. I could get a loan for 2% interest, but it is due in 6 months, so the payment would be $5000 a month, well, I am more concerned about the payment. If I am paying $1000 for all of my credit card and car debt, and I can knock that payment down to $300 a month, that makes good sense, in addition, the interest that I am paying is TAX DEDUCTIBLE, whereas the interest on the car and the credit cards is not.
15:06, 28.05.2010
First of all cancel your credit cards i.e., cut them up and pay them off.
You could be a credit card tart and take out a new one at 0% interest which should help. But – don’t spend any more money on them.
1. If your present mortgage is at a good rate, stay where you are. You often get charged when you start moving around.
2. Don’t get a home equity loan – too dangerous – you could risk losing everything.
3. Fatal – don’t touch this at all. It is the expensive road to nowhere.
4. Go to http://www.save-money-guide.com and request a Free Report on Debt – just click on Free Reports page.
5. Follow the good advice on the web site and you will soon start saving money and improve your financial position.
Regards Jo.
15:06, 28.05.2010
You’re not paying off debt with your plan. You’re just moving it. The debt is still there. How about getting on a written budget, adjusting your lifestyle, and paying extra toward your debt. That’s the only way to pay off debt.
15:06, 28.05.2010
Never, ever, ever roll the money on your house. That’s a terrible idea. If you put that money on your house and something happened and you couldn’t make the payments. They will take your house.
The goal here is to Pay your house off. Not add to the cost/debt.
check out daveramsey.com and listen to his radio show. He has lots of good advice on money and debt.
15:06, 28.05.2010
Doing a cash out refinance may make alot of sense as long as you can handle a slightly higher monthly mortgage payment. Right now you may qualify for a refinance with a 30 year fixed program with very low rates. If you are interested, I can help you- just email me at dantaft@bellsouth.net