PostHeaderIcon How can a debt consolidation loan that also includes home repairs and will reduce monthly costs by $650 be bad


 Powered by Max Banner Ads 

I checked out the loan and the interest is not too bad giving that this is a second mortgage that gives money for repairs and pay offs. The only thing I see is that it eats up all the equity and we will need to live in our home for at least 15 years before trying to sell…so that alone is the biggest decision. I am just wondering if there is anything else I should be looking for???
Thank you for the advice. The rate is 9.5% Fixed for 15 or 20 years. There is no pre payment penalty.

4 Responses to “How can a debt consolidation loan that also includes home repairs and will reduce monthly costs by $650 be bad”

  • kindclinton2000 says:

    It’s not bad, but it could hurt your credit standing for awhile and you won’t be able to use credit cards.

  • boldkevin says:

    Is it an adjustable rate/ That could be very bad. additionally, what is the rate? Is it very high (2 Percentage points above the national average) if it is you are paying too much. Are there any loan costs, how much are they? more than say 2 percent of the loan?
    Is it a 15 year prepayment clause? can you not prepay it for 15 years at all? that is bad as you may want to move.

    There is a lot to consider. Your equity will increase because house values increase with time, but an adjustable rate mtge is a killer. also, if the rate is to high, shop around, you may do better,
    Try gettinga loan directly from the bank. they are usually cheaper than a broker, and they tell you alot more about your eligibility , credit scores etc.

  • Mee says:

    9.5%! That’s a lot! Is it through a reputable lender? Make sure that the lender you are using isn’t a scam artist and check ALL the fine print.

  • morris says:

    Around here you can get home equity loans for 7.7% today. The bad thing is that you are going farther in debt for a longer time. You are also giving up you share of ownership (equity).

Leave a Reply

Powered by Yahoo! Answers