How to Consolidate Mortgages & Credit Cards

One way to eliminate credit card debt is to roll it into your mortgage loan. To do this, you'll need good credit, equity in your home and a loan that works for you. Just keep in mind that by adding your credit card debt into your mortgage loan could reduce the amount of money you make when you sell the home. The consolidation of your debts will use a portion of the equity in your home.

Instructions

Consolidation Process

1

Tell your mortgage lender you want a consolidation loan. A loan officer will take an application and examine your credit report to get a picture of your financial condition.

2

Tell the loan officer which credit cards you want to roll into your mortgage. The lender will review your debt-to income-ratio.

3

Choose a loan term that works and understand your interest rate. A fixed interest rate will make ensure your payment does not change. A variable rate could be lower but could rise in the future. A combination of a fixed and variable rate is also a possibility. Those rates are usually fixed for a set number of years, and then become variable.

4

Review all fees. If you are offered a loan, make sure you understand costs such as points, title search and an appraisal fee. An appraisal will determine if there is enough equity to consolidate your debt.

5

Let the lender pay your credit cards directly. Don't close your credit card accounts after they have been paid off.