Debt Consolidation May Help Relieve Holiday Spending
Holiday spending can add up quickly and place many people further in debt. Close to 40% of household’s carrier an average credit card debt around $16,000. It is estimated those households added another $1,000 in debt over the holiday season.
One option to help manage finances after holiday spending is debt consolidation. Consolidating debt into a new mortgage program brings multiple debts into a single monthly payment. With debt consolidation, borrowers pay off their debt in full, usually with no negative consequences to their credit.
There are multiple options for borrowers wanting to consolidate their debt. Some options are; home refinance and home equity loans. Often times these options carry lower interest rates compared to credit cards. Lower interest rates can make monthly payments lower and more affordable.
In addition to lower monthly payments, sometimes, the interest payments may be tax deductible. Mortgage interest is any interest a borrower pays on a loan secured by a main home or second home. In many situations, interest paid on loans secured by real estate is allowed as a tax deduction.
Debt consolidation can provide borrowers with financial relief. However, it is important to manage and control any additional debt that may be incurred before the consolidation loan is paid off. Mismanagement could cause the borrower the same financial issues prior to debt consolidation.