Debt consolidation loan Maryland

Refinancing your existing mortgage into a debt consolidation loan in Maryland combines your debts into one payment. This is a great option if you have high-interest loans and you’re only paying the interest rather than the principal. … Debt consolidation mortgages come with a structured payment plan and an assured pay-off date. As with other debt relief, a little education goes a long way. Learn how to pay off your debts, increase your credit score, and see improvements on your credit report.

Debt consolidation loan rates

Since credit cards and other forms of consumer debt often have double-digit interest rates, it is little wonder that debt consolidation is such a popular debt relief option in Canada. Taking out a good debt consolidation loan can often save 5 percentage points or more on your debt interest payments. Depending on your credit history, your interest rate savings could even surpass 10 percent. Your bank or credit union may charge a 7% – 12% interest on debt consolidation loans. Other finance companies may charge 14% or more for secured loans, and up to over 30% for unsecured loans.

How much can you save with debt consolidation?

The average interest rate on credit cards in Canada is approximately 19%.[1] At that rate, a $10,000 debt could generate up over $6,200 in interest charges on a standard 2.5% minimum payment schedule. With some minimum payment schedules that only pay the interest plus 1% of the balance, the interest charges could add up to over $15,000.Cutting the interest rate down to ten percent with a debt consolidation loan can help you save thousands. With a 60-month unsecured loan at 10% APR, you’d pay just over $2,700 in interest.What’s more, you would pay off the debt faster and have slightly lower monthly payments. There are many debt consolidation loans, and the way they calculate interest differs.

Is refinancing to consolidate debt a good idea?

Overall, a debt consolidation refinance can be a smart way to pay down debts at a much lower interest rate. But it requires a high level of discipline in making payments to avoid negative consequences.

Can you consolidate credit card debt into your mortgage?

Yes you can take advantage of your home’s equity and combine the money you owe into a debt consolidation mortgage (also known as a conventional mortgage ), home equity loan or line of credit.

Which is better credit card refinancing or debt consolidation?

Debt consolidation aims to turn many debts into a single debt, saving you money and making debt easier to manage. Refinancing aims to optimize an existing debt by replacing it with debt that has more favorable terms (usually lower interest rates).

What is the smartest way to consolidate debt?

• Keep balances low to avoid additional interest, and pay bills on time.
• It’s OK to have credit cards but manage them responsibly.
• Avoid moving around debt with a credit consolidation loan.
• Don’t open several new credit cards to increase your available credit.

Is there a downside to refinancing for debt consolidation?

Refinancing a mortgage can lower your monthly payment and reduce your interest rate. However, one downside of refinancing is that it restarts your loan term, and that can cost you more in the long run — even if you lower your interest rate

Debt consolidation expert

Contact the Ability Mortgage Group to get your financial future back on track

Call today at 1-410-210-4241

 

 

Photo by Karolina Grabowska