How to Get Out of Debt Fast

Do you find yourself struggling to make those monthly bill payments because you have a lot of debt? Are you conscious of the fact that many of those monthly payments go only to interest while paying off very little of your actual outstanding balance? There are ways to get out of debt fast out there, but sometimes it is difficult to know which ones are best for you. 

Do you constantly hear those offers on the radio that talk about debt consolidation and find yourself thinking about them as an option for solving your debt problems?  These options are being provided by bankruptcy trustees or debt counsellors – but they are often not the best option, especially for homeowners. Firstly, these solutions come in the form of a consumer proposal or bankruptcy. Although they can help you get out of debt fast, these options can have devastating long term impacts on your credit, negatively impacting your ability to secure financial funding in the future. Your ability to purchase a new home, refinance your mortgage, or even buy a car can be severely reduced when you have a consumer proposal on your credit report.

So how do you get out of debt fast? If you are a homeowner, refinancing your mortgage is a much safer financial option for getting out of debt fast. By consolidating your debt through refinancing your mortgage, you eliminate the various minimum monthly payments – much of which are primarily interest - into one manageable payment.

Additionally, not only is this single monthly payment much smaller than what your various others combined were, having it combined into a refinanced mortgage ultimately saves you thousands of dollars in interest long term. It is also far likelier that you will be able to pay off the mortgage sooner than if you had kept all of the credit card balances going and paying only the minimum payments.

Banks vs. mortgage brokers – how do they fare when you are trying to get out of debt fast? Have you been to the bank and discussed your options regarding how to get out of debt fast, but failed to receive approval? This is often because banks stand to gain from your continuing to pay only the interest on your credit cards – think about who controls many of those cards in your wallet! The longer you pay only the interest instead of paying the cards off outright, the longer the bank makes money off of you. Also, banks tend to work with fewer lenders and follow stricter guidelines when it comes to who qualifies.

Mortgage brokers on the other hand work with a much more diversified portfolio of lenders and are able to cast a much wider net. This means that the options available to you for getting out of debt are much more numerous when working with a mortgage broker. Rather than focusing solely on your credit score, a mortgage broker can often secure you financing at a good rate when the bank has continually refused.

There are many options out there to help you get out of debt fast, but if you are a homeowner, refinancing your mortgage is usually the best choice! For more information on how to get out of debt fast, please contact Paul Mangion at The Mortgage Centre by calling 416 204 0156 or visit www.themortgagecentretoronto.com