Second Mortgages: Your Key to Debt Consolidation
Second mortgages are regularly used to consolidate outstanding debt. If you own your own home, a second mortgage may be your key to turning multiple high-interest loans (like credit card loans, for example) into a single monthly payment at a much lower rate. Taking advantage of debt consolidation can simplify your finances, lower monthly payments, and make paying off debt quicker and more affordable.
What is a Second Mortgage?
A second mortgage is a second loan secured against your home or property, over and above your first mortgage. Second mortgages take different forms, but one of the most widely utilized is the home equity loan.
Getting approved for an Alpine Credits home equity loan is one of the fastest and most convenient ways to use the value you’ve built up in your home to help pay off any outstanding debt.
Unlike the stringent lending procedures practiced by most banks and credit unions, all you need to qualify for a home equity loan with Alpine Credits is to own your own home, property, or other real estate. Our loan approvals are based on your home equity value – not on your income or credit history.
How Second Mortgages Help Consolidate Debt
Credit cards represent some of the most crippling debt in Canada. In fact, recent data suggests that not only do 30% of Canadians not pay off their credit card balances each month, the resulting interest payments amount to a staggering $7 billion a year.
Many homeowners look to a second mortgage for help consolidating their debt when they find themselves:
- struggling to stay on top of credit card balances,
- unable to get ahead financially because mounting consumer loan, student loan, or personal line of credit debt is preventing them from saving or investing their earnings, or
- wanting to get out of debt, but battling such high interest rates on their loans that they can’t seem to reduce the principal in a reasonable timeframe
One of the biggest advantages of a home equity loan is that it comes with a significantly lower interest rate than the average credit card, small personal loan, or unsecured online loan. And that makes it extremely effective for tackling more expensive debt with one relatively low rate loan.
So how does debt consolidation actually work? It’s simple.
Once you’ve applied and been approved for a home equity loan (Alpine Credits regularly offers same day application approvals), loan funds are typically deposited directly into your bank account. You can then use that money to pay off your higher interest loans in full, leaving you with one simple-to-manage, lower interest payment.
Here for Canadian Homeowners
If you’re a homeowner whose debt or credit score is making it difficult to get a second mortgage from the bank, Alpine Credits provides an alternative solution. We can often get you access to a portion of your home’s equity – and on the road to better debt management – within a very short time.
- a lower interest rate,
- better term, or
- more manageable payment structure than your current consumer debt loans