Mortgage Refinancing is a Solution for Debt Consolidation

By: David Nalin

Consumers facing overwhelming and unmanageable debt may consider mortgage refinancing as a solution to meet financial obligations. Home values have skyrocketed greatly this past decade and potential borrowers may find their home equity will suit their needs through mortgage refinancing.

Consolidating all Current Debt with One Repayment
Mortgage refinancing employs equity accrued in a home to make cash available for repaying many higher interest bearing debts. Through putting this equity to debt reduction, or elimination, use a consumer cannot only chip away at accumulated debt, but may find considerable savings in the process. The lump sum obtained through mortgage refinancing can eliminate many separate outstanding monthly obligations such as a car loan, credit card payment, student loan or other personal loan pulling these together – consolidating – where one monthly repayment is considerably less than all put together.

Who Should Consider Mortgage Financing for Debt Consolidation?
• People with short terms of employment or none long enough to qualify for a standard loan
• Self-employed individuals
• People on government allowance including New Start
• Previously granted bankruptcy
• Pensioners
• People with adverse credit history
• Consumers declined by other lenders
• Loans in arrears
• None or limited savings history
• Limited savings history

Professional assessment of an individual personal financial situation will reveal the possibilities toward using mortgage financing for debt consolidation. There are quite a few advantages from obtaining mortgage refinancing.

What are Some Benefits Derived From Mortgage Refinancing?
• Mortgages can be repaid faster
• Mortgage repayment time terms can be extended lowering monthly charges
• Obtain a lower interest rate that presently possessing
• Consolidating other monthly payments such as credit cards and auto loans into one with a lower mortgage interest rate
• Ability to draw funds from equity available for personal needs

Consolidation Makes Sense
Mortgage refinancing is typically available at a much lower interest rate than all the revolving credit normally available to consumers who can qualify. Credit card interest is usually much higher than a mortgage rate. Additionally, depending on when the loan was secured, a car loan may also have a higher rate than mortgage refinancing can provide. The aspect that the equity built up in your home is the “collateral” for the loan allows lenders to offer more favourable terms to consumers seeking to cash in on the increased value of their home. Furthermore, debt management is made a lot less complicated when only one monthly repayment has to be managed instead of having to look over and execute multiple repayments. Also, more people realise greater savings through a one-repayment monthly money management system.

Make Sure You Get All the Information Needed
When seeking mortgage refinancing for debt consolidation always approach three to five lenders so you gain enough information to make an informed decision. Keep in mind that unlike obtaining a new home mortgage, your basic qualification is the equity in your home. Mortgage refinancing is not a necessity loan such as a car or new home purchase. You don’t have to make it. Therefore, let three to five lenders play off one another to gain your business.

Your gain will be the best mortgage refinancing deal that suits your personal needs.

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Austral Mortgage Corporation offers competitive mortgage rates for both residential and commercial loans. We are also an expert on Mortgage Refinance to help you find the best loan to suit your situation. So whether you are looking for a mortgage or mortgage refinance, contact our reliable mortgage expert and let us do the hard work for you.

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