Consolidating debts can save you money if you know how

The financial outlook of our country has change over the last year and now more than ever consumers need to look at their debts. Maybe consolidating these debts onto the mortgagewill save you money. To start with write down on a sheet of paper all of your debts, who they are owed to, the time left to pay, how much they cost each month and the interest rate. By organising your finances in this way you will have a much clearer picture of how much you owe and to witch creditors.

Once you have a list of payments you can see which loans and credit cards are costing you the most money on a monthly basis? Some credit cards may have come to the end of their introducer rate. You will also want to pay off the cards with the highest interest rate first.

Some loans maybe near the end of the term and it would be advised to leave them as they are, but for credit cards with a high rate of interest and loans with more than a year to run it would be cheaper to consolidate these debts and remortgage.

Some people say that consolidating existing debt onto a mortgage is not a good idea. However if you are smart a debt consolidation mortgage can save you thousands. Most lenders these days will let you make overpayments on your mortgage of up to 20% of the mortgage balance on a yearly basis.

After consolidating all of your debts on to the mortgage this will free up money each month, which can then be used to not only pay down the mortgage but also over pay and reduce the term of the mortgage. There by saving you even more money each month as the debt gets smaller.

It’s easier than ever before to get one of the homeowner mortgages that you require for debt consolidation. All you really have to have is sufficient equity in your property and full time employment so the bank can see that the new mortgage will be repaid.

A mortgage advisor is a good person to speak to, they not only advise you on which lender would be best for your situation, but they can also advise on which lenders will let you make the overpayment that you require to bring down the mortgage debt quickly.