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Resolve to Eradicate Those Debts
By Michelle Anderson
Would it not be the most relaxing start to your new year to begin with a
manageable balance sheet? Post-holidays, the merriment and cheer often
give way to anxiety at the prospect of larger than average credit card
bills. Couple those credit payments with mortgages, car payments, and
other miscellaneous loans, and January can be wrought with stress.
Thankfully, though, there is a ray of hope amid the massive stack of notices and
statements littering your desk. Debt consolidation, when done correctly, can
save you hundreds of dollars a month.
There are a variety of options for debt consolidation. As you shop for a new
loan, be aware that there are several types that bill themselves as perfect for
debt consolidation. The most prevalent is refinancing your existing mortgage. If
you are a homeowner with only one mortgage on your house, this could be the best
money-saving loan. After all, the interest you pay on your mortgage is tax
deductible, so there is some benefit to using your home equity to pay off those
other high interest unsecured loans.
Another option is to take a second mortgage on the house. The interest rates
for this kind of loan are generally a few percentage points higher than on a
second mortgage, but it is still likwly tax deductible, and may even be lower
than some of your credit card interest rates. Debt consolidation in this form
means you will have two mortages on your home, but those will be the only
payments you'll have to make every month.
What if, though, you are not a homeowner? How can you too cash in on debt
consolidation? It is, to be certain, slightly harder to wrap all of your smaller
debts into a larger, lower interest loan without a house to use as collateral.
An unsecured personal loan could possibly have slightly higher interest, and not
be tax deductible. Nonetheless, if you are paying higher interest on anything
else, it is still a better choice.
Debt consolidation can be the freedom from stress that you need. Imagine
receiving a lump sum payment that can eliminate all of your little bills and
potentially save you hundreds of dollars a month in interest and minimum
payments. Take control of your finances this year, and resolve to be stress free
and relaxed with a debt consolidation program tailored to you.
============================= About the Author Michelle Anderson provides insight and info on a broad range of topics. Visit onelocate.com for more info on debt consoldiation and other sought-after products and services.
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