If you are a Canadian living in debt, you are not alone. According to Statistics Canada, household debt grew faster than income last year, with Canadians owing $1.79 for every dollar of household disposable income to debt.
So how can you quickly improve your financial position? Debt consolidation.
What is Debt Consolidation?
Debt consolidation means paying off smaller loans with a larger loan usually at a lower rate of interest and usually for a lower monthly payment. For example, a credit card with interest of 19.99% can be paid off by including the debt in a refinance of your mortgage at a 5 year fixed rate of 2.89%.
What are the Benefits?
• With a lower rate of interest, you will be able to pay more towards the principle of the loan. Which means you will be debt free faster.
• You will only have to make one monthly debt payment. This is more manageable than keeping track of multiple debt payments with different interest rates.
• Your credit score will likely improve if you were carrying balances on your revolving credit items that were close to or at the limit.
If you have existing consumer debt or are considering an investment or renovation, contact Pilot to see how you may be able to use your home equity to improve your overall financial position.
“If you have existing consumer debt or are considering an investment or renovation, contact Pilot to see how you may be able to use your home equity to improve your overall financial position.”