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Why the Banks Won't Tell You About Mortgage Debt Consolidation

And it Can Save You Thousands!

This article shows you how to "unlock" some of the hidden cash-flow that exists just by properly consolidating your loans with your mortgage, the result being that you can realize thousands and thousands in savings...

• • •

Tell me if any of these sound familiar:

• Most of your bills just seem to keep getting the better of you and there is just far too much month left at the end of the money
• What started out as a mole hill of bills has now become the Rockies
• You're constantly borrowing money from one credit card and/or line of credit to make the minimum payment on another
• You're constantly screening your calls to avoid the collection agencies
• You just don't know how you're going to get through the month
• You're tired of saying "no" to your kids every time they ask for something
• You don't want to live like this anymore

Not everyone who finds themselves in these situations are poor money managers, more often than not it's the little or in some cases major emergencies that crop up which have painted them into this corner! Things like losing a job, an unexpected illness or injury or the death of a loved one or it could be a major breakdown of your car.

It doesn't matter who you are unless you have a sizable "rainy day" cash reserve you're going to get soaked! And before you know it, the monthly payments that were manageable are now overwhelming.  In most cases it's not the debt you've accumulated that does you in, rather it's the interest on this debt that's the killer.

When you're paying rates in the range of 15% to 30% on those instant cash plans like credit cards, pay day loans and alike you're just digging yourself a deeper hole. Because the rates are so high, so is the interest cost and just paying that is a battle and once you lose that battle the unpaid interest just piles on to the principal, which now means, you guessed it - more interest.

Show me the Savings!

Now in a perfect world the ideal solution to paying off your debts would be to have more income, but let’s face it, it’s kind of hard to walk into your boss’s office and ask for a 100% increase in your salary, because you need it. It would certainly be nice however, huh? So that leaves us with restructuring our debt, by doing this you can have more money and less month, instead of your current less money and more month! You can put this extra money to work for you by using it to pay off more of your total debt and save thousands in the process!

Fortunately, if you currently own a home with equity in it, restructuring is a real possibility. By using record low mortgage interest rates to pay off all of those debts with the much higher rates, you can begin to save both time and money, two things that will ultimately lead to financial freedom!

Now let's take a look at some examples of what a mortgage debt consolidation could look like...

Meet Vic & Judy they are a typical couple who have a home which is worth $300,000 and a mortgage of $180,000. At an interest rate of 5.25% and a 35 year amortization period, their monthly mortgage payments are currently $931 per month.

Vic and Judy also have credit cards with balances totalling $25,000. Let's say that the average interest rate for the credit cards is 20%, just paying the interest only is $416 per month.  In addition they both have vehicles that they owe $40,000 combined with payments totalling $852 per month. Their total debt load including the mortgage is $245,000 ($180,000 + $25,000 + $40,000) while all of their current monthly payments total $2,199.

The Savings Chart
Before Consolidation

After Consolidation

(35 Yr. Amortization)

After Consolidation

(25 Yr. Amortization)

After Consolidation

(13 Yr. Amortization)

Mortgage Amount $180,000 $245,000 $245,000 $245,000
Mortgage Payment $931 $1267 $1460 $2163
Credit Cards $416 $0 $0 $0
Auto Loans $852 $0 $0 $0
Total Payments $2199 $1267 $1460 $2163
Savings Monthly $0 $932 $739 $36

Now let's see what a restructuring would look like, what if we were to roll up all of their debts into one new monthly mortgage payment. Even if we were to keep the interest rate the same and the amortization the same the new payments would be $1267 per month, that's a savings of $932 per month, money which would give them much needed breathing room.

Now let's take a look at how they could really make this work for them, what if they were to get a 25 year amortization, they payments then would be $1,460 per month, that's still saving them $739 per month. Now let's get crazy and say that Vic & Judy could actually manage their current payments but what they really wanted to do is get mortgage free sooner rather than later, they could do a 13 year amortization resulting in monthly payments of $2163 per month, that's still $36 less than what they're paying now and cutting their mortgage by 22 years!

Incredible isn't it, now can you see why the banks are reluctant to show you this, the interest you are saving is money that they're not making. You don't need a Harvard business degree to see that mortgage debt consolidation makes excellent business sense.

So if you're sick and tired of being buried under a mountain of debt, here is the way out so don't wait another day, get started today down the road to economic recovery and freedom!

About the Author:

Kam Brar is a licensed mortgage broker and has been directly involved in the lending industry over the past 10 years, bringing with him a wealth of knowledge and experience. His particular specialty throughout his career has been working with "challenge" customers, where it takes creative financing (and sometimes private loans) to accomplish their goals.

His role with ShangriLoan is that of a consultant and mortgage industry liaison.

ShangriLoan Ventures LTD ( does not provide loans or mortgages, and is also not an acting broker in any capacity. is an editorial & directory publishing service and an advertising intermediary connecting borrowers with brokers or otherwise services relevent to their specified needs. is compensated by its advertisers for referring qualified site users who submit a request for a lending/mortgage quote from advertisers who are matched to the users needs. Please see our compensation disclosure and privacy policy for full details on our operating procedures.

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