Use What You Already Have

There are other options rather than having to change your job or skim down your outgoing expenses. It is fully appreciated that changing your lifestyle is something that can be seriously hard for anyone. This is the time when you need to focus on what equity you could be freeing up in what you own. Now, this is an obvious choice if you are a home cut credit cardowner. You should look at how much equity is in your home and how much the mortgage repayments are that you are making per month. Since you have taken steps to repair your credit, you should shop around lenders to see if you could get a better rate with taking some of the equity out of your home.

This is where you need to strike a clever balance act. You want to free up enough equity to pay off your outstanding debt that is not in your house, such as car and credit cards, without taking so much money out the payments are higher. Its simple math. If you can take money out of your home and pay less than you are paying now, with other debt paid off, its is a great idea.

The first place to start is with your current lender, even if you have missed some payments. They already have the lien on your property and the amount it will cost you to put in an application will be smaller compared to a new lender. Talk with the lender about your plan, debt consolidation from their point of view is not always a bad thing, especially if your credit report has been repaired.

They will see that you are making an effort to pay off debt, which in turn protects their relationship and their investment in your property because if you go bust, then they will have to foreclose and sell your property. It is an expensive drastic step that no lender wants to do at any time. Run the numbers and if it is a logical step then it is worth you putting in an application to see if you can rework your finances that way. Try different lenders and approach them with your credit score in hand to get a preliminary decision on how much you can borrow through them. Remember, you only need enough to pay off the money you owe.