Understanding home loan mortgage purchase refinance credit

Debt Consolidation Tips: Maximizing the Equity in Your Home with a Second Mortgage Loans

Are you moving within the next 3 years? If not refinance your debt that has compounding interest rates. Refinancing your existing home loan with a cash-out option or taking out a home equity loan as a second mortgage can provide ways to consolidate high-interest consumer debt at a lower rate. Also, the interest you repay on the refinance or home equity loan may be up to 100% tax deductible.

If you're like most people with high-interest credit card debt and other high-interest installment loans, using your equity for bill consolidation makes good financial sense. When you consolidate debt, you're using your mortgage to pay off the higher-interest creditors while "rolling" that debt into your mortgage. Credit card consolidation by mortgage refinancing could substantially raise your FICO credit scores, too! The reason: you're lowering your debt ratio. According to Fair Isaac and Company, the creators of the FICO credit scoring system, paying down the balances on your credit cards by 34% could raise your FICO scores almost 20 points. Imagine how much more your scores could rise if you paid them entirely.

How much can I borrow? The amount you borrow for a refinance or a home equity loan (second mortgage) will partly depend on what you currently owe on your mortgage(s) and how much your home is worth. The difference between these two figures is the amount of home equity you have to work with. You may qualify to borrow against part of your equity (typically 75% to 80%), or even up to 125%, and receive cash to pay off bills such as car loans, credit cards, or other installment loans.

Refinancing your home loan or taking out a second mortgage in the form of a fixed rate second mortgage loan, also known as a home equity installment loan (HEIL), or a variable rate home equity line of credit (HELOC) to consolidate your debts can help get you back on track financially. But, you have to be careful not to accumulate new debts. Otherwise, you'll pay a larger mortgage (or two mortgages) while still carrying burdensome credit card debt. Consider cutting up all but one of your credit cards and keeping the one for emergencies only. But, dont close the accounts, or your credit history can appear younger than it actually is which could actually lower your credit scores.

Maria Ny is a highly regarded free-lance writer who has published many debt consolidation and refinancing articles directed at homeowners across the nation. Get more tips, and free home loan quotes at BD Nationwide Mortgage for Second Mortgage Refinancing. For more home equity loan advice and bill consolidation tips, visit Second Mortgage Debt Consolidation Loans and Home Equity Refinance.

More Useful Resource and Updates on home loan mortgage purchase refinance credit

• Rams Home Loans drops variable mortgage rate (The West Australian)
  Rams Home Loans (Rams) has dropped the interest rate on its standard variable home loan by 60 basis points. The interest rate on Rams? standard variable home loan has dropped 0.6 percentage points to



• The Wrong Mortgage Derails a Mother?s Plans (New York Times)
  Christina Natale wanted to give her children a stable home, but what she got was a mortgage she couldn?t afford.



• Low hopes for new mortgage program (Standard-Examiner)
  WASHINGTON -- The government expects only 20,000 troubled borrowers will apply to refinance into more affordable home loans by next fall under a new mortgage aid program passed by lawmakers over the summer.



• Mortgage rates drop slightly in week (UPI)
  WASHINGTON, Nov. 6 (UPI) -- Interest rates for 30-year, fixed-rate U.S. mortgages dropped slightly in the week ending Nov. 6, the Federal Home Loan Mortgage Corp. said Thursday.



• Rams Home Loans drops mortgage rate (The West Australian)
  Rams Home Loans (Rams) has dropped the interest rate on its standard variable home loan by 60 basis points. The interest rate on Rams' standard variable home loan has dropped 0.6 percentage points to 7.59 per cent, while the interest rate on Rams' basic home loan is now 6.99 per cent.



• Mortgage aid program gets little attention (The News Journal)
  WASHINGTON -- The government expects only 20,000 troubled borrowers will apply to refinance into more affordable home loans by next fall under a new mortgage aid program passed over the summer.



• It's time to think about refinancing that high-rate mortgage (The Record)
  Many Americans affected by the economic crisis want their unaffordable mortgages reworked through special programs for people facing foreclosure. But you don't have to be in financial trouble to benefit from mortgage refinance, real estate experts say.

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