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If your objective is to reduce interest rates, avoid bankruptcy, consolidate your bills and have one monthly payment, then you may be able to lower your cost of credit by consolidating your debt through a second mortgage or a home equity line of credit - better known as a debt consolidation loan.
Here are some examples of high interest debt that you could consolidate with a debt consolidation loan:
- Personal loans
- Old service bills
- Collection agency debts
- Student loans
- Medical and legal bills
- Tax debts
- Department store cards
- High interest credit cards
- High interest auto loan
There are other types of debt that can be consolidated with a debt consolidation loan. We wanted to give some examples of debt that would qualify for this type of loan so that you can get an idea.
Remember with a debt consolidation loan, the debtor actually takes out a second mortgage or a home equity line of credit to consolidate their bills into one, easy-to-manage payment. By using the home as collateral you are able to secure a lower interest rate which will allow you to pay more to the balance and less in finance charges, which will help pay the debt off sooner. One thing to keep in mind is be cautious with this route. If you use your home as collateral and you fail to meet the terms of the loan, you may lose your home.
Proceed with Debt Consolidation Loan
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