Debt Consolidation

This involves lumping all of your existing debts - mortgage, bank overdraft, credit card debts, store card debts, etc - into one lump sum in the form of a mortgage loan secured against your house equity.

Because it is secured on your property, a mortgage can be a relatively cheap way of repaying debts on a monthly basis. Certainly cheaper than paying the interest rates charged or bank overdrafts, and credit and store cards debts, particularly when you take late payment and other charges into consideration.

However, keep the repayment term in mind, because longer-term mortgage agreements can end up with you paying more overall because you are paying interest over a longer period. There is a balance between interest charges and repayment periods, but if you find it easier to pay smaller amounts over a longer period of time, particularly when charges are considered, then this could be a good solution for your debt problem.