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83 votes.
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Matatan enjoyed some free time
to watch a little TV over the weekend and was surprised to see three
commercials in just one hour convincing viewers to consolidate debt with the
re-finance of their homes. Matatan thinks that these debt
consolidation plans are not only stupid, but dangerous. It places
consumers in a deeper debt hole with the risk of losing their homes.
Those that jump on these offers in the hopes of getting rid of debt may
actually take on thousands of dollars of additional debt. A person recently e-mailed me, who consolidated credit card debt during a re-fi back in 1998. She and her family never quit using credit cards and once again face a huge burden of new debt along with the combined mortgage and old credit card debt. The Detroit News reports that half of all re-finance loans issued so far during 2001 was for the sole purpose of debt consolidation and not for the improvement of the home. Are you feeling cornered by your debt? You'll paint yourself in a corner when you re-finance your mortgage and roll into that all of your debt. Don't trade one debt for another. |