Consolidating debt mortgage refinance mortgage refinance
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One of our Credit Counsellors will be happy to offer you debt consolidation advice.
It is wise to remain mindful of the fact that we are currently living with historically low interest rates.
This means that we cannot count on them to stay this low forever.
What does using home equity to consolidate your debts mean?
Essentially it is using the equity in your home / refinancing your home to consolidate your debts into one payment in order to pay off your debts.
A "Home Equity Loan", "Home Equity Line","refinancing your mortgage / re-mortgage" and getting a "second mortgage" are all different names for the same thing and are sometimes used as a debt consolidation option.
These terms refer to the bank lending you money against the portion of your home that you own.
This is because consolidating high interest debt – like credit card balances and auto loans – into a low interest mortgage can save you thousands in interest payments.
The average five year mortgage rate over the past 60 years has been 8.95%.
So if you are considering refinancing your home, make sure you can afford an "average" interest rate of 9% in the long term.
Finance companies and sub-prime lenders also offer mortgages.
Their interest rates will almost always be higher than the bank's and can often range between 14% - 30%.