Debt Consolidation Loans

: Chris Lee Law Firm

  Filed under: Loans

consolidation loanWhen you find yourself paying several lenders, and it seems like your whole check is being sent out, you might consider a debt consolidation loan or filing bankruptcy.

Consolidation loans are usually secured by the equity in your home or other assets. Since the loan is secured, the interest rates may be better, and a longer repayment schedule will help you keep more of your monthly income.

With the lump sum, you may pay off your high-interest loans, like credit cards and catch up on payments you may be behind in. Instead of making multiple payments, you can make one, sometimes lower payment. In some states, you can deduct the interest on a second mortgage loan, be sure and check with your tax professional before assuming this will be true for you.

Making the Payments

Before you take out these loans, you must be sure you will be able to make the payment, now and in the future. Having high-interest rates on a credit card is bad, but losing your home because you’ve attached the debt to a secured loan is worse.

If you get behind on your credit cards and other unsecured debt, the lenders will call and attempt collection, at some point they may even threaten you with a lawsuit. But if you added those payments on to your home, and you get behind you could lose your home.

Credit Cards

If on the other hand, you continue to use those credit cards and add more debt before the consolidation loan is paid off you may find yourself in dire circumstances. You will owe more than before the loan, and you will no longer have equity in your home.

Debt Consolidation Calculator

Using a free online debt consolidation calculator, and honestly analyzing your budget can help you decide if a debt consolidation loan is right for you.

If you are on the fence about whether to get a consolidation loan, or you have one already and are in risk of losing your home, contact a Fort Worth bankruptcy attorney to see what other options you may have.

Are you a candidate for bankruptcy?
Would you like to find out if bankruptcy is the right option for you? Try our Free Online Bankruptcy Evaluation. 4 easy steps to see if bankruptcy could be the right option for you!
  • Step 1
  • Step 2
  • Step 3
  • Step 4
Please Select Each Box That Applies To You
Creditor Harassment
Loss of Income
Disability or Illness
Current Expenses
Auto Loans
Credit Cards
Medical Bills
Payday Loans
Do you have any additional information you would like to share?
Contact Information