Consolidated loan..pros/cons – 2nd mortgage?

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We just purchased our first home. Have a good income but have 30k in misc debt – including: timeshare, credit cards… We now make about $ 1200 in payments each month to various companies – thinking about consolidated loan or 2nd mortgage. ONLY IF IT WILL REALLY HELP OUT…if not, I’d like to stay where we are as we usually get some sort of bonus check annually plus other bonuses….we can easily use that to pay some of the debt off. Our mortgage company suggested 2nd mortgage and a friend told me about a consolidated debt loan…need some info please.

5 Comments
  1. Reply
    PK
    May 2, 2011 at 4:28 am

    I would compare the rates between a bunch of the two types and look at the terms too. Also something to consider is if you take a second mortgage, that debt is against your home. If you consodliate your miscellaneous debt into one loan, you may be able to get a better rate than your current one without taking a loan out against your home. The consolidation loan would be unsecured.

  2. Reply
    Joe C
    May 2, 2011 at 5:25 am

    If it were me, I would sell the timeshare.

    Rolling debt over into another form is usually a quick “fix” and doesn’t solve the problem.

    You made one mistake by purchasing a house while deeply in debt, don’t make another by trying an easy fix.

    If you do get the bonus, pay off the rest of the debt.

    If the bonus doesn’t come through, cut expenses and pick up some extra income.

    Get those debts paid off.

    You can do it!

  3. Reply
    Austin G
    May 2, 2011 at 5:49 am

    The most common types of 2nd loans are Home Equity Lines of Credit and are cheap to get (sometimes free). A HELOC is variable, usually based on Prime. You are going to need about 20% equity in your home now to do this, did you put 20% down when you bought it?
    I’m not sure about consolodated debt companies.

  4. Reply
    Angel
    May 2, 2011 at 6:19 am

    If you consolidate or take a 2nd mortgage be smarter than my husband and I, we ended up running up the credit cards and line of credit to high levels again. So not only did we have the 2nd mortgage we also had the high debt again. Stupid people.

  5. Reply
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    May 2, 2011 at 6:33 am

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