Home refinancing debt consolidatings
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Among those considerations: Does refinancing make sense, and are you aware of the danger of rolling unsecured credit card debt into your secured home loan?
A homeowner with shaky finances shouldn’t move unsecured debt that can be erased in bankruptcy to secured debt that can’t. That’s the maximum time you’d be required to make payments toward Chapter 13 bankruptcy or a debt management plan — after which your debt would be fully retired.
Chapter 7 bankruptcy would wipe out your debt immediately and get you on a path toward restoring your credit.
MORE: Calculate personal loan rates If you’ve ruled out other options, weighed the pros and cons of consolidating with home equity and determined it’s the viable path, then it’s a choice of a home equity loan or a HELOC.
Home equity loans are a type of second mortgage based on the value of your home beyond what you owe on your primary mortgage.