Consolidating debt into your mortgage good idea dating matt damon disaster movie

If you are considering doing this, realize that it’s rarely if ever a good idea to pay off credit card debt with the equity in your home.

For example, if your house is worth 0,000 but you only owe 0,000 on your mortgage, you could potentially remove some of the equity in order to pay off debt with a higher interest rate attached to it than what you pay on your mortgage.

If you do not pay, credit card companies can sue you – but they may not go to the trouble unless you owe a lot of money.

However, if you don’t pay your mortgage, you lose your house. You typically need to pay for an appraisal and possibly a home inspection.

You also must pay loan origination fees and closing costs.

However, the opinions expressed here are ours alone and at no time has the editorial content been provided, reviewed, or approved by any issuer.

Everyone knows that credit card debt is “bad” debt due to the high interest rates on most consumer credit cards, while mortgage debt is often described as “good” debt.

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There are many arguments that people make in favor of refinancing a home mortgage to take out cash to pay off their debt.

For instance, mortgage interest is tax-deductible, while interest on credit card debt is not.

Do you want to still be paying for the clothes or vacations you charged 30 years from now?

Because of the extra time it takes to pay off a mortgage, you may even end up paying more in interest on the debt over the life of the mortgage loan than if you simply commit to paying off the credit card debt as quickly as possible.

The difference between secured and unsecured debt also matters in a bankruptcy situation.

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