For example, what if interest rates go up, or you fall ill or lose your job?
If you can’t stop spending on credit cards, for example because you’re using them to pay household bills, this is a sign of problem debt.
If you do choose to go this route, you should make sure that you try to pay off this extra mortgage as quickly as possible and don’t do this very often.
If you find yourself doing this every year or two, that means that you are spending more than you make, and it is going to take forever to get your mortgage paid off at this rate.
To consolidate all of your debts, your first option would typically be to approach your bank or credit union and see if they can help you.
If you have a mortgage, you might look to see if you have enough equity in your home to consolidate your debt with your mortgage.
Myth: Debt consolidation saves interest, and there’s one smaller payment.
Truth: Debt consolidation is dangerous because it only treats the symptom.
For instance, if you can’t make your payments on a home equity loan, you may lose your house.Ideally, this new account or loan will have a lower interest rate than the accounts had previously.