When you are having a load of unsecured debt against your name, your top priority should be taking control of it to reduce it as much as possible and not ignore it. Delaying such debts like a high credit card balance, which has the highest rate of interest in the finance industry, will not only jeopardize your financial health but will also affect your health as well. The more you ignore and delay the more interest you will have to pay, and the debt will continue to exist seemingly forever. Such unnecessary payment of extra interest will limit your repayment capacity and prevent you from focusing on the other debts that you currently have.
Finding The Finance
Theoretically and on papers, it seems very nice that you can get rid of any high debt put in practice it requires a lot of discipline and diligence. At first, you will have to find a suitable source to pay it off as you will have already used up your available resource. Therefore, you will have to look or a suitable financer which is very hard to find. Even if you find someone, no one will do you a favor without any interest and interest is the thing which has led you to such a sticky position and which is what you want to deal with currently. The only plausible and effective way to do so is with some respite is if you have a home and can use it for the repayment.
Refinancing Your Mortgage
Utilizing the home or at least the equity of your home, you can get a reduced rate of interest to pay as compared with the current one that you have to pay. Even if you have an existing mortgage, you can get it refinanced easily and pay off other debts. The low rate of interest of such refinancing will surely reduce your monthly obligations along with getting your other debts cleared. As the money you receive will be more than what you currently owe, you can save the remainder for emergency purpose or set aside to repay the debt. You also get to enjoy an extended tenure for repayment of the refinanced debt.
Cash Out Refinancing
You can also take out a larger mortgage the amount of which will pay off the current mortgage dues and the money left after closing can be used to pay off the other debt bills that you have. The only requirement is that you must have enough equity in your home to enjoy such cash out refinance.
Home Equity Loans
Lastly, you can take out home equity loans to pay off your existing debts. This loan is also known as the Second mortgage in the finance industry. You can use the equity in your home as a collateral security to pay off your debts. Therefore, you should take care to maintain your property always so that the market value of the home remains high enough that the amount owed to the lender. Checking out for debt consolidation loan rates and going the best is a wise decision these days. You can check for it online and can make your struggle and search easy.