Should You Mortgage to Consolidate Your Debt? The Dos and Don'ts of it According to Expert Mortgage Advisor in Ireland

 Getting into a debt trap is never the plan. But planning for Debt Consolidation is crucial lest it not become a bigger trap than the one you are already in. Mortgaging can be a safe and secured credit system to pay off existing debts and they are comparatively easier to get than unsecured loans. But as the idea of getting out of your existing debts welcomes the hopes of a breather, here are some key pointers and fact check to keep you faithful to your new commitment of repaying the Mortgage Loan.

 

Mortgage for Debt Consolidation - What It Means And How It Works

 

Consolidation means getting a big amount of loan to pay multiple outstanding loans. The amount of the Consolidation Loan would be greater than the combined amount of all your Outstanding Loans - credit card bill, outstanding electricity bill, insurance premiums, personal loans etc.

 

If you own a house, then you can use the asset for mortgaging that could possibly arrange the massive amount needed to liquidate all your outstanding loans. If you are having a hard time paying off EMIs every month solely with your monthly income, largely living in hand-to-mouth conditions, then this can be a breather to allow you to pay off all your debts in the form of a single fresh new loan, of a lesser amount than all your monthly EMIs and premiums combined. 

So you can pay off your bills, and even have a little amount to save. Much like a planned recovery.

 

Home Mortgage terms can extend to 20years in the Republic of Ireland. It is recommended to consult an independent broker before you apply. Loan enquiries affect your credit score, so you need to limit your enquiries to a maximum of 3 in a year. Typically, a reputed finance & mortgage broker in Cork and other big cities would be Central Bank regulated and can help you choose the most substantial schemes unbiasedly and help you with loan calculation without affecting your credit score. Independent brokers are fee-paying service providers, they usually don’t get paid any commission from the financial institution you choose. So your best interests are their top priority.

Factcheck - You Are Still Under Debt - So Be More Responsible

 

When given a second chance, many people make the same mistake. So here’s a fact check -

Debt consolidation is the biggest loan of your life - and your home is at stake. So you have to be more responsible with it.

 

A leading mortgage advisor in Cork revealed the fact how borrowers often lose focus from repaying their debt and get carried away to make new purchases and investments with their loan money - this is a BIG NO-NO.

 

Maybe your kitchen badly needs a makeover, maybe your loved ones need new medical equipment… Such crucial financial needs are part of life and they are often the most soul-crushing. It is very tempting to use up your Mortgage Loan money to pay for these immediate needs. But refrain from it, and use your Mortgage Loan only to repay debts. If this fails you will be in no position to recover. So wait till you have saved up enough to get your life back.

Think Twice Before Foreclosing Personal Loans or Mortgages

When it comes to Credit Card bills or Flexi Loans - pay off the entire debt amount. But when it comes to personal loans, home loans etc, always cross-check if foreclosing would incur fees and how it will impact your credit score. If you are restless to pay off the debt and are not confident whether you can protect the mortgage money to continue with your long-term EMIs, then you can pay in advance.

Best Resources Of Mortgage Planner in Cork, Galway, Dublin -

Have a plan!

It is a standard plan to take out at least 30% more of the amount needed to pay off your debts. This extra money can work as your leverage, help you save a portion of your income and also run your day to day needs. Save up for emergencies and use the money only for emergencies.

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