Mortgage Debt Consolidation Eases Bill Burden on Maryland Residents

By Joe Taylor Jr.
Local Lender Columnist
Jan 24, 2007
Recent government regulations forced credit card companies to double their customers' minimum monthly payments. Those with adjustable-rate mortgages are watching their monthly bills climb with their interest rates. Some Maryland residents must manage high gas prices coupled with 21 percent rate hikes in their utility bills.

Mortgage debt consolidation may be the golden ticket for strapped Maryland homeowners. Mortgage rates have hit a five-year high and are expected to continue to rise, so it's an excellent time to look into this. Using your mortgage for debt consolidation of some of your high-interest debts could make your payments much more manageable.

Getting Started with Mortgage Debt Consolidation

If you feel overwhelmed with debt payments, your first step should be to see a consumer credit counselor or financial advisor, or to consult an online financial calculator. Maryland is home to at least eight offices of national non-profit consumer credit counseling services, which you can locate easily through an online search.

Here is some personal financial information influence your new payment after mortgage debt consolidation:

• Total credit card debt
• Auto loan balance
• All other installment loans
• Mortgage

The final calculation could result in a lower payment than your previous payments combined.

Mortgage Debt Consolidation Requires Caution

While mortgage debt consolidation may look like a panacea, it can have hidden drawbacks. A lower payment may sound great up front, but you will be making more payments over a longer time than your original mortgage. Your new payment will also be connected to your mortgage, so if you can't make your payment, you risk losing your house.

With proper financial advice, mortgage debt consolidation may draw you out of debt and guide you to financial freedom.

Sources
Best Syndication
Business Week
DinkyTown
San Jose Mercury News

About the Author
Joe Taylor Jr. has covered business and finance news for Financial Times Television and CNBC. He coaches beginning mortgage brokers to provide better customer service and to understand creative financing opportunities.