Refinancing safety belt
If you have been looking at your credit card and other accounts statements, you could be one of many who is concerned about how to get rid of this noose around your neck! A question for you, is would you be happy if those debts disappear and you were left with just one, manageable payment, with mortgage refinancing? The answer should be affirmative because $13,000 in credit card debt is the equivalent of $100,000 in mortgage debt.
Probably at present, your financial debt situation is divided into segments, one being the all important mortgage commitment, on which you’re paying an average of 2.5 percent interest. Then there are the other segments; for example a variety of credit cards, lines of credit all of which have an average interest rate of about 20-percent. You probably know the total debt in these segments and how much it costs you every month. But, fortunately, there is light at the end of this critical financial tunnel!
Your debt-relief goal
Your goal is obviously to get some financial relief from your debt trap and the way to do it sounds and is relatively simple; consolidate all your debt segments into one. However, it must be the one having the lowest interest rate, which is your mortgage portion.
A quick assessment will show the amount of money you can save by refinancing your mortgage, even just considering the cost of interest. Also, take into account that by consolidating your debt into a single debt, you will also be paying it off quicker, because a significantly larger part of your monthly repayment will be credited to the actual debt and not the interest it accrues.
If you are positive about getting out of your debt trap, then just do this little exercise and prove it! Determine the yearly interest payments on your mortgage at 2.5-percent. Then, how much interest are you paying annually on your credit cards and other accounts, based on an average 20-percent?
The answer could surprise you when you consolidate all your segments with mortgage refinancing. In other words, you would be paying only 2.5 percent interest on all your debts. If you have some doubts about how to work the percentages and numbers, have a friendly word with your local mortgage broker in Guelph; and, get out of your debt trap!
At Mortgage Guys, we’ve helped many individuals take control of their finances and relieve the pressure of credit card debt. There are many refinancing options and if you would like to explore them, get in touch today!