What is the best debt consolidation company? I think it might be better to ask what can I do to get out of debt other than signing up for credit counseling or a debt consolidation loan? If own a home and have equity in it, you have the ability to do a refinance and pull money out to pay off your bills.

How can I get out of debt fast?

If you have a home that has equity, you can do a cash out refinance with a new mortgage and pay off your credit cards and other debts. Putting your credit card debt into your home loan will give you a much lower payment. Credit cards are designed to work off of simple interest and a mortgage loan is amortized. A credit card balance of $30,000 may give you a payment of over $1100. If you moved the balance into a new mortgage, your new payment would be just under $205 when it is calculated on an amortized basis. Keep in mind that doing a new mortgage will have closings costs that could cost you a few thousand dollars. Keep in mind that when you put your credit card debt into a new mortgage you are now putting your home at risk in the event you still have a problem paying the debt back. If you do not pay your credit cards, there is nothing to take from you. If you stop paying your mortgage, the bank will foreclose and take the property back.

Is getting a heloc a good way to get out of debt?

Instead of doing a traditional refinance you may want to consider getting a home equity loan or a second mortgage instead. Most of the time a home equity loan or heloc will have no closing costs. Credit card payments are not tax deductible however if you use your mortgage to pay off your credit cards, you can write off the interest payments on your taxes.

Ask your credit card company for lower interest rates

It can’t hurt to pick up the phone and see if you can get better rates from your credit card company. You may need to threaten that you will move to a company that is offering you a lower interest rate. They don’t want to loose you as a customer

This information is designed to be of general interest and should not be considered legal advice. The specific information discussed may not apply to you. Before acting on any matter contained herein, you should consult with your personal legal adviser or attorney.

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