Debt Consolidation Mortgages in Connecticut

Posted on January 9, 2018 · Posted in Connecticut Mortgage Refinance

Debt Consolidation Mortgages


Is your credit card debt making you feel financially strapped? Refinancing your home loan may be a great option to consolidate your bills and get rid of high interest charges. That way, you put all your loans and debt into one, easy to remember payment. By getting rid of high interest rates on your credit cards and combining them into one, you’ll end up paying less each month than when you pay all the bills separately. You can do this by refinancing your existing mortgage, cash-out refinancing or taking out a home equity line of credit.


Refinancing Your Home


Mortgage interest rates are still at record lows so it may be a good idea to refinance in order to reduce your monthly payment. The money you save can be used to pay off other debts such as credit cards or student loans.


Cash-out Refinancing


If you have enough equity in your home, you may be able to substantially reduce your monthly payments on credit cards, student loans, medical expenses and personal loans.


Sometimes, these loans are known as “cash-out” refinancing. That’s because you are cashing out of your home’s equity to use for other things. How this works is that you take out a new, larger mortgage that pays off your old mortgage and leaves you with extra money at closing to pay off your debts. When consolidating debt, you must remember that it isn’t gone, it’s now in a different place. You’ll owe only your primary mortgage lender instead of owing a number of third-party lenders and credit card companies.


Home Equity Line of Credit


Another option may be to take out a second mortgage, also known as a Home Equity Line of Credit (HELOC). A HELOC is a revolving line of credit with an adjustable rate. The interest rate is typically lower than the interest rate you’d pay on a credit card.


Is a Debt Consolidation Loan Right for Me?


When exploring these options, you have to remember to be disciplined in your spending and not run up your credit card debt again. If your debt continues to grow, you might find yourself in a pickle again and at that point, you may have no more equity left to bail you out.


Being in debt is not a fun place to be- call us today. I’d be happy to help you talk about your options.





Drew Raney/NMLS#117309
President of Northeast Financial
210 S. Main ST. Middletown, CT


Company NMLS#117273


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