Reputable Debt Consolidation Companies
Written by Allan Marcell on August 21st, 2008If you are having problems getting out from under debt and you own your own home, debt consolidation through a home equity mortgage might be a consideration for you. Using this method, you will end up paying one creditor every month instead of a handful or more of them.
Consolidating with Home Equity
When you receive a home equity mortgage, you are loaned the difference between what is owed on your house and how much your house is worth. An example: You have a home that is worth $300,000 and you owe $120,000 on the mortgage. You can get a loan for $180,000. With that, you will be able to pay off your first mortgage and use $60,000 to pay off your credit card debt. You will have one debt with one interest rate to pay on. You will also have used your home as collateral for the loan.
There are hundreds of companies who want your business. The key is in finding the right one with which to work. Debt consolidation companies are not all the same and they do not all operate under the same code of ethics. To find out more about the company you are thinking of doing business with, check the BBB or Better Business Bureau either online or by phone. Go to sites online that have posting specifically for disgruntled debtors and try to contact someone who has had a loan through the company before you make any commitments.
Before you make any commitments, make sure you know how much your interest rate will be. If your interest rate would be higher than you are comfortable with, you should find a company that offers better interest rates on their loans. If you have difficulty with impulsive buying or living above your means, you should find a service that specializes in credit counseling. This kind of service can go a long way toward helping you stay out of debt.
The difference between a good home equity loan and a bad one could mean future financial security or the loss of your biggest asset - your house. Consider your choices carefully and if you choose debt consolidation by getting a home equity mortgage, just be sure you have the best possible loan with the best interest rates you can get.
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