A Personal Look at Debt Consolidation
I always say that Linda and I had no excuse for having so much debt. We were in our forties, after all. It wasn't as though we were young college kids struggling to get along. We both had great jobs. But who really needs an excuse?
By the time we decided to consolidate our debts, we had a lot more than either of us had realized. We brought together our credit card statements, and that alone was enough to make us both feel pretty sheepish. We also had an unsecured loan left over from a business I'd half-heartedly tried to start. And just a few weeks before, we'd upgraded to the newest computer with all the latest features. It made our old computer desk look pretty shabby, so I'd thought it wouldn't hurt to pick up some new home office furniture as well. Both the computer and the new desk and printer stand came complete with a hefty payment plan. I didn't even want to add it all up and figure out how much interest we were paying.
We discussed several ways to consolidate the debt. We could have waited for the next 0% introductory credit card to come along, transferring all our expenses to it. We also discussed the possibility of another unsecured loan, but in the end, a home equity loan made the most sense for us.
We took the bills we wanted to pay off to our loan officer and she pulled our credit and took a look at the amount of equity we had available in our home. It turned out we could pay off the unsecured loan, two of our credit cards, and the computer bills, all with a home equity loan. This let us lower our interest rates from almost 22% on a blended basis down to only 6.5%. Plus the 6.5% was tax deductible. And, the monthly payment we had mapped out with the loan officer more than met our budget. Once we knew this, consolidating our debt was an easy decision to make.
We closed on the loan a few weeks later. When the checks came through, they were already made out to the creditors we'd specified for the amounts shown on the statements we'd given to our loan officer. Nothing felt better than sealing up those envelopes and sending those payments off!
I just finished doing our taxes for the year, and because the home equity loan that we used to consolidate our debt counts as a second mortgage on our home, the interest we pay is tax-deductible. It was a nice bonus to receive the extra money back on our taxes for doing what we already knew was the right thing.
I've been stashing away a little bit of the money we've been saving on our bills each month and I plan to surprise Linda on her birthday with a week-long cruise to the Caribbean. She's been dropping hints for years about wanting to take a cruise, so it's nice to finally be able to afford it. I know. I know. Just because we're finally saving some money is no excuse to start spending again, but I think Linda's birthday is a great excuse, and after all, who really needs an excuse?
Click here for a free debt consolidation analysis to reduce your debt >>
By the time we decided to consolidate our debts, we had a lot more than either of us had realized. We brought together our credit card statements, and that alone was enough to make us both feel pretty sheepish. We also had an unsecured loan left over from a business I'd half-heartedly tried to start. And just a few weeks before, we'd upgraded to the newest computer with all the latest features. It made our old computer desk look pretty shabby, so I'd thought it wouldn't hurt to pick up some new home office furniture as well. Both the computer and the new desk and printer stand came complete with a hefty payment plan. I didn't even want to add it all up and figure out how much interest we were paying.
We discussed several ways to consolidate the debt. We could have waited for the next 0% introductory credit card to come along, transferring all our expenses to it. We also discussed the possibility of another unsecured loan, but in the end, a home equity loan made the most sense for us.
We took the bills we wanted to pay off to our loan officer and she pulled our credit and took a look at the amount of equity we had available in our home. It turned out we could pay off the unsecured loan, two of our credit cards, and the computer bills, all with a home equity loan. This let us lower our interest rates from almost 22% on a blended basis down to only 6.5%. Plus the 6.5% was tax deductible. And, the monthly payment we had mapped out with the loan officer more than met our budget. Once we knew this, consolidating our debt was an easy decision to make.
We closed on the loan a few weeks later. When the checks came through, they were already made out to the creditors we'd specified for the amounts shown on the statements we'd given to our loan officer. Nothing felt better than sealing up those envelopes and sending those payments off!
I just finished doing our taxes for the year, and because the home equity loan that we used to consolidate our debt counts as a second mortgage on our home, the interest we pay is tax-deductible. It was a nice bonus to receive the extra money back on our taxes for doing what we already knew was the right thing.
I've been stashing away a little bit of the money we've been saving on our bills each month and I plan to surprise Linda on her birthday with a week-long cruise to the Caribbean. She's been dropping hints for years about wanting to take a cruise, so it's nice to finally be able to afford it. I know. I know. Just because we're finally saving some money is no excuse to start spending again, but I think Linda's birthday is a great excuse, and after all, who really needs an excuse?
Click here for a free debt consolidation analysis to reduce your debt >>
