Tuesday, May 24, 2011

How Debt Consolidation Makes Sense

How debt consolidation makes sense

When it comes to consolidating debt, we get the most online inquires in Canada. That's because debt consolidation, also referred to as a Refinance is quite common these days. It's not because more people are in debt, it's simply because it just makes sense.
Pulling equity out of your home at today's great interest rates can save you as much as 17% a month in interest charges!
The valuable equity that you may already have in your home can be used to consolidate high interest credit card debts, credit lines and even car loans.
In the past, for a client to consolidate credit card and loan debts, a second mortgage was your only choice. Did you know second mortgage rates can be as high as 19%?
Today, you can top up your existing mortgage to incorporate those debts and remove the debt load without having to take out a second mortgage. Why would you choose that expensive avenue over refinancing at today's 5-year rate of 3.99%*.
Victor Peca will guide you through a painless process to get you on the road to a debt free lifestyle.
Actual Example
Victor helps many clients every month, leverage the equity in their home to consolidate the debt and lower their overall payments. The following example was the case for one of our clients. It clearly shows the money they were able to save each month.




Before Debt Consolidation
Existing Mortgage
Property Value
$350,000
Mortgage Balance
$270,000
Interest Rate
5.2 %
Term
5 year
Monthly Payments
Credit Cards ($8,000)
$250
Other Debt ($3,000)
$150
Mortgage payments
$1,601.21
Total Payments
$2,001.21










After Debt Consolidation
Victor Peca Mortgage
Property Value
$350,000
Mortgage Balance
$305.00
Interest Rate
3.99 %
Term
5 year
New Monthly Payments
Credit Cards ($0)
$0.00
Other Debt ($0)
$0.00
Mortgage payments
$1,448.61
Total Savings/Mth
Total Savings/Year
Total Savings 5 Yrs
$552.60
$6,631.20
$33,156.00






As this example shows, we were able to refinance their existing mortgage before the term was up and get them the money they needed to pay off all debts and lower their monthly mortgage payment by $152.60. So they saved a total of $552.60 per month and have been able to put that extra money into an investment account for their retirement.
Your next step...
In order to take advantage of this program you must be a home owner and have at least 15% equity or more in your home. If you have any concerns or questions please include them in the application/comments section or email us directly.
The best way to determine whether debt consolidation is the right avenue for you is by calculating what your monthly debt payments total. Include all loans, lines of credit, credit cards and your mortgage. Take that amount and divide it by your gross total monthly income. If the number is higher than 0.50 then don't leave this site. If you are below 0.50 we can still help save you money.
Fill out our online Application at Apply Now and let us do the leg work for you. The secret is to determine at an early stage whether debt consolidation is the best route for you.

1 comment:

  1. Thank you for your great job. This is the info I have been looking for.
    Debt Collection

    ReplyDelete