How a Debt Consolidation Mortgage Saved This Couple $35,000

The Benefits of a Debt Consolidation Mortgage

So, how’s your debt? Imagine if someone used that as a conversation starter? If you are like most people, it would be a pretty quick conversation. The truth is, even if it was a socially acceptable topic, most people do not want to talk about debt because theirs is out of control. But if they did talk, they would realize that options exist such as a debt consolidation mortgage.

$4,456.12 In Monthly Debt Payments

Consider the following:

A couple, one half of which is employed full time and the other who is retired, is carrying a substantial amount of debt:

Type of Debt Amount Interest Rate Monthly Payments
1st Mortgage $261,000 2.35% $1,155.37
2nd Mortgage $111,000 9.99% $915.75
Credit Cards $51,000 19.99% $885.00
Consumer Proposal $17,000 $1,500.00
Total $440,000   $4,456.12

The couple had been struggling with this debt for years, even doing a Consumer Proposal* and taking a 2nd mortgage, but were just not able to get ahead of the debt. The good news is, they did want to talk about it, and that’s why they came to me.

We were able to refinance with a new 1st Mortgage of $451,600 (80% of their home’s value) to consolidate their debt. The couple’s debt now looks like this:

Type of Debt Amount Interest Rate Monthly Payments
1st Mortgage $451,600 3.79% $2,094.10
Total $451,600   $2,094.10

$35,000 Saved In The First Year

Now, although the total debt is more, they are saving $2,362 per month or $28,344.24 per year for the next 2 years. We chose 2 years to give the couple’s credit time to rebuild at which time we will move them into a lower interest rate mortgage. They are also saving $6,000 in interest payments on those credit cards. The savings are derived from the overall lower interest they now pay on all on the total debts. The bottom line: Almost $35,000 that stays in their pockets this year and priceless peace of mind.

*A consumer proposal is a formal, legally binding process that is administered by a Licensed Insolvency Trustee (LIT). In this process, the LIT will work with you to develop a “proposal”—an offer to pay creditors a percentage of what is owed to them, or extend the time you have to pay off the debts, or both. – Source: www.ic.gc.ca/eic/site/bsf-osb.nsf/eng/br02051.html

So, how’s your debt? Let’s have a conversation: Click Here For Free 20 Minute Mortgage Strategy Session or complete our 60 second online Debt Consolidation Quiz to see how much a debt consolidation mortgage can save you each and every month.

Dominion Lending Centres Edge Financial
8 Sampson Mews, Suite 201 | Toronto | ON | M3C 0H5, FSCO #10710

Please visit the Financial Services Commission of Ontario Directory for more information and to check licensing status at http://mbsweblist.fsco.gov.on.ca/agents.aspx