If you own a home, you may apply for a refinance debt consolidation loan or I call it the (RDC Loan). This type of loan will allow you to have only one payment every month. This should give you a little relief and free up some cash for you. You may also be more attentive in paying your refinance debt consolidation loan when you know that your house is on the line if you miss on your payments. This can be either a pro or con, just depends on how you view things.

Many people today are living from paycheck to paycheck. Most of them do not even notice where the money they earn goes a day after their paycheck is received. Many of them are in deep financial difficulty and are already in the threshold of filing for bankruptcy. Once you take advantage of the refinance debt consolidation loan, it may help avoid filing for bankruptcy, get you out of debt & help to increase your credit score.

You may need this type of refinance when you feel that your monthly obligation becomes difficult to manage. It may be able to help you avoid being subject to late payments charges and high interest rates. This is also necessary when you start to notice that even after making your monthly payments your balance still remains the same.

Pros:

Reduces Monthly Payments

Tax Deductible Interest (ask a tax consultant)

One Monthly Payment vs. Many

One Interest Rate vs. Many

Cons:

Refinancing Costs

Starting Your Mortgage Over

You may get a higher rate

Fee's Breakdown

Title Fees Usually 1% of the loan amount.

Lender Fees Usually $800 to $1,500

Broker Fees $500 to 2% depending on how much they choose to charge.

A fee to have your property re-appraised, if necessary

Not including Escrow account in the scenario to make things less complicated

These fees normally should add up to about 3% of your loan amount, so on a $80,000 loan you should approximately pay $2,400, which can be rolled into the loan. Now you have one payment but your loan is starting all over and you just paid $2,400 in fees.

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