Debt consolidation company recommendations please

[gtivan]

Some people are going to have to educate me on why no 2nd mortgage. BTW, helocs are not home equity loans.

Given this calculator

Debt Consolidation Calculator

Free debt consolidation calculator to evaluate the consolidation of debts such as credit cards debts, auto loans, or personal loans based on the real cost.

www.calculator.net

$50k in credit card debt at the average of 18% interest and $1k in monthly payments is paid for in 94 months for a total of $93k in total payments.
2nd mortgage with $50k, $2.5k in origination fees, 10% interest and $987 in monthly payments can be paid off in 5 years 6 months for a total of $65k in total payments.

Personally i would get a home equity mortgage in a heart beat, shave off years and close to $30k in payments. Of course it still depends on his total debt, expected pay off term, ability to make a monthly payment, etc.

As OP stated. once in a life time deal by life smacking him across the head. It happens. He doesnt have an issue other than debt he wants to consolidate.

 

[2ndtimer]

BTW, helocs are not home equity loans.

Umm, HELOC literally stands for HOME EQUITY Line of Credit, Hint: if you don't have any equity in your home, you aren't going to qualify for a HELOC.

 

[gtivan]

Umm, HELOC literally stands for HOME EQUITY Line of Credit, Hint: if you don't have any equity in your home, you aren't going to qualify for a HELOC.

Home Equity Loan vs. HELOC: What's the Difference?

Is a home equity loan or a HELOC right for you? Before using your home as collateral for one, consider both your financing needs and your appetite for uncertainty.

www.investopedia.com

Key Takeaways

• Home equity loans and home equity lines of credit (HELOCs) are both based on a borrower's equity in their home.
• A home equity loan comes with fixed payments and a fixed interest rate for the loan term.
• HELOCs are revolving credit lines with adjustable interest rates and, as a result, variable minimum payment amounts.
• The draw periods of HELOCs allow borrowers to withdraw funds from their credit line as long as they make interest payments.
• After the draw period, full repayment of both principal and interest begins.

In other words a heloc may as well be a credit card with your loan as backing. a home equity loan is a straight up loan.

 

[nwslopoke]

What is your time line? If you don't have an emergency looming or if something isn't ridiculously expensive, you may be able to focus on this year (2025) and clear things up.

I paid off the lowest dept owed, then went to the next, and so on. But I sold a vehicle to get the ball rolling. The savings from paying off each dept freed up enough that the next was paid off relatively quick. Within 2 yrs, I had excellent credit and almost no debt.

 

[Jay Walk]

Newsflash, a loan that needs paid back prior to offering clear title to the next owner is in fact A HOME EQUITY LOAN.

I love those advertisement that say, "Don't pay the bank, borrow money from yourself"
Can't believe those are not a RESPA violation.

 

[Koda]

In other words a heloc may as well be a credit card with your loan as backing. a home equity loan is a straight up loan.

turning your home equity into a credit card actually sounds worse to me...

 

[gtivan]

turning your home equity into a credit card actually sounds worse to me...

Which is a very good reason to avoid HELOCs

 

[Joe13]

As OP stated. once in a life time deal by life smacking him across the head. It happens. He doesnt have an issue other than debt he wants to consolidate.

I'm assuming most of the back and forth is just people wanting to put in an opinion but if you are somehow under the assumption that I am one of the people that can not control spending and borrows to get toys before I can afford them then I would point out the statement above and say it is spot on.


With the way this thread has gone, you would think I posted and said that .22lr is more powerful then a .357mag or that 9mm is better then .45acp (well the 9mm part is true) .

I had someone with a finance background reach out privately and offer to talk me thru some pro's and con's, but I do appreciate everyone's input - argumentative or not, I mean it is NWFA after all and while I know and continue to meet many many wonderful people here; they all have some really strong opinions lol.

I do not agree with needing motivation to pay off my debt and do not need monthly motivation - if you were to ask anyone who knows me personally, they would tell you I own pretty much nothing that is top of the line or things that I do not need or use.

I have a household income that will pay off my debt in some time (I'm really not going into the specifics of numbers on a public forum for obvious reasons) and both my wife and I are in places where we have reached the next level of life and carrier where yearly raises will continue to add to our income and have little chance of another medical accident happening (knock on wood) so consolidation was a lot of wanting simpler bills to keep track of monthly and not wanting to pay $94k on a (this is hypothetical and not my reality) $50k debt when I can do it with $60k in total payments.

I don't make so much as to be able to afford to not shop on Amazon for the prices due to moral issues and I still think paying $1,000 for something is extravagant while always doing my research into something I want and only buy things that are good deals for the price.

Yes, I have some nice things but I know for a fact that my nicest firearm is less costly then most peoples least expensive firearm and I am not and will never be (probably) in a place to buy a gun a week or multiple at a time - I shop the ads and sometimes I get lucky enough to be the first to respond to a screaming deal on something I already had in my list of things I would like to have but am to cheap to spend full price on.


Pretty much the ONLY exception to the above is my tools. I have made a living on them for most of my life in various trades and jobs and know the value of a well made (although more expensive) tool but I also do not loose or neglect my tools so I have some very nice stuff that has lasted me many decades and stuff that will most likely continue to serve me well for many more years to come.


I do have a guitar that is worth $1400 or so and is one of my prize possessions that I could have paid cash for from my 'allowance' fund but decided 24 months of no interest payments would be good for my credit (that debt was paid off years ago before time and not part of this current situation). Even that though is not even as priceless to me as a firearm a fraction of the cost that was given to me out of friendship or the act of a very kind member here.


Again, I am friends with some of the people and good acquaintances with many others in this thread that are on polar opposite sides of the debates that have happened here so hopefully everyone is adult enough to understand if I haven't jumped on one bandwagon or the other because I just have not had a lot of need to know anything about compounding interest or long term payments other then a house I will own sooner or later in full as my last debt as far as I am concerned.


It's almost Christmas and Friday the 13th which has always been a lucky day for me.

I hope everyone has a stress free, happy end of the year and gets everything they want and deserve in this new year coming up.


Thank you again for being such a wonderful community.

 

[arakboss]

Let's see. I owe $100k at 10% interest for 10 year term.

The loan institution offers to reduce that interest rate to 1% on a different 10 year loan with no loan fees.

It makes sense I should keep the old loan at 10%

 

[arakboss]

Home Equity Loan vs. HELOC: What's the Difference?

Is a home equity loan or a HELOC right for you? Before using your home as collateral for one, consider both your financing needs and your appetite for uncertainty.

www.investopedia.com

Key Takeaways

• Home equity loans and home equity lines of credit (HELOCs) are both based on a borrower's equity in their home.
• A home equity loan comes with fixed payments and a fixed interest rate for the loan term.
• HELOCs are revolving credit lines with adjustable interest rates and, as a result, variable minimum payment amounts.
• The draw periods of HELOCs allow borrowers to withdraw funds from their credit line as long as they make interest payments.
• After the draw period, full repayment of both principal and interest begins.

In other words a heloc may as well be a credit card with your loan as backing. a home equity loan is a straight up loan.

Correct and a home equity loan usually has fixed terms.

 

[joeyou]

Some people are going to have to educate me on why no 2nd mortgage. BTW, helocs are not home equity loans.

Given this calculator

Debt Consolidation Calculator

Free debt consolidation calculator to evaluate the consolidation of debts such as credit cards debts, auto loans, or personal loans based on the real cost.

www.calculator.net

$50k in credit card debt at the average of 18% interest and $1k in monthly payments is paid for in 94 months for a total of $93k in total payments.
2nd mortgage with $50k, $2.5k in origination fees, 10% interest and $987 in monthly payments can be paid off in 5 years 6 months for a total of $65k in total payments.

Personally i would get a home equity mortgage in a heart beat, shave off years and close to $30k in payments. Of course it still depends on his total debt, expected pay off term, ability to make a monthly payment, etc.

As OP stated. once in a life time deal by life smacking him across the head. It happens. He doesnt have an issue other than debt he wants to consolidate.

Home equity loans put your house at risk. Default and they foreclose on your home. Not the case with unsecured credit card debt. Just pay off the debts, don't take loans to pay off loans.

 

[arakboss]

I'm assuming most of the back and forth is just people wanting to put in an opinion but if you are somehow under the assumption that I am one of the people that can not control spending and borrows to get toys before I can afford them then I would point out the statement above and say it is spot on.


With the way this thread has gone, you would think I posted and said that .22lr is more powerful then a .357mag or that 9mm is better then .45acp (well the 9mm part is true) .

I had someone with a finance background reach out privately and offer to talk me thru some pro's and con's, but I do appreciate everyone's input - argumentative or not, I mean it is NWFA after all and while I know and continue to meet many many wonderful people here; they all have some really strong opinions lol.

I do not agree with needing motivation to pay off my debt and do not need monthly motivation - if you were to ask anyone who knows me personally, they would tell you I own pretty much nothing that is top of the line or things that I do not need or use.

I have a household income that will pay off my debt in some time (I'm really not going into the specifics of numbers on a public forum for obvious reasons) and both my wife and I are in places where we have reached the next level of life and carrier where yearly raises will continue to add to our income and have little chance of another medical accident happening (knock on wood) so consolidation was a lot of wanting simpler bills to keep track of monthly and not wanting to pay $94k on a (this is hypothetical and not my reality) $50k debt when I can do it with $60k in total payments.

I don't make so much as to be able to afford to not shop on Amazon for the prices due to moral issues and I still think paying $1,000 for something is extravagant while always doing my research into something I want and only buy things that are good deals for the price.

Yes, I have some nice things but I know for a fact that my nicest firearm is less costly then most peoples least expensive firearm and I am not and will never be (probably) in a place to buy a gun a week or multiple at a time - I shop the ads and sometimes I get lucky enough to be the first to respond to a screaming deal on something I already had in my list of things I would like to have but am to cheap to spend full price on.


Pretty much the ONLY exception to the above is my tools. I have made a living on them for most of my life in various trades and jobs and know the value of a well made (although more expensive) tool but I also do not loose or neglect my tools so I have some very nice stuff that has lasted me many decades and stuff that will most likely continue to serve me well for many more years to come.


I do have a guitar that is worth $1400 or so and is one of my prize possessions that I could have paid cash for from my 'allowance' fund but decided 24 months of no interest payments would be good for my credit (that debt was paid off years ago before time and not part of this current situation). Even that though is not even as priceless to me as a firearm a fraction of the cost that was given to me out of friendship or the act of a very kind member here.


Again, I am friends with some of the people and good acquaintances with many others in this thread that are on polar opposite sides of the debates that have happened here so hopefully everyone is adult enough to understand if I haven't jumped on one bandwagon or the other because I just have not had a lot of need to know anything about compounding interest or long term payments other then a house I will own sooner or later in full as my last debt as far as I am concerned.


It's almost Christmas and Friday the 13th which has always been a lucky day for me.

I hope everyone has a stress free, happy end of the year and gets everything they want and deserve in this new year coming up.


Thank you again for being such a wonderful community.

A good goal would be to get the debt paid off with the least amount of interest paid. Any changes you can make that will lower the total interest paid, would be worth looking into.