That's because debt consolidation, a type of mortgage refinance, is quite common these days.
It's not because people are in debt, it's because it makes sense.
How Does Debt Consolidation Loan Work Debt consolidation loans are usually unsecured but there is an option to add outstanding balances to your mortgage provided that there is enough equity.
The main difference between both is the fact that your home serves as collateral.
Debt consolidation is helpful to people who can’t make their full monthly payments on time.
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There are three main ways to consolidate your debt into your mortgage.
Refinancing requires you to break your mortgage term early and consolidate your mortgage and other debts into one loan of up to 80% of your home’s value (otherwise known as the LTV, Loan-to-Value ratio).
When you share your lives together, consider reducing your debt as a team.
Sharing the details of your debt with one another can help you get a handle on paying off what you owe.