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Is consolidation right?
I need help. I'm considering debt consolidation, but, I'm not sure it's the right thing to do. I have about $160,000 in equity on my home. However, I have horrible credit because of IRS leins. I owe the IRS approximately $44,000 $800 a month payment and I owe on a car approx $26,000 $629 per month payment.
I've been working with a mortgage broker. What they have offered to do is get me a fixed interest loan and pay off the IRS and the car. This would bring my mortgage payment up from $1762.80 to $2362.59/mo. It also cuts my payments on my house from a remaining 16 years to a 15 year loan. It also reduces my interest rate from 7.75% to 6.39%. The bad part is they are charging 2 points and approx $9000 in fees and closing costs.
On first look basis, I think it's a good idea. This bring in approx $877/mo in expendable income. Here's where I'm getting confused. If I hang it out until May 2005, I will have the IRS paid off. Which in itself gives me $800/mo more without adding $70,000 to my mortgage. Of course I will still need to pay my car payment.
I'm really confused and don't know if this is a good idea or if I should just suffer through and not add to my mortgage.
I'm also trying to get my credit repaired and refinancing would put me on the road to that end.
HELP!!!
I've been working with a mortgage broker. What they have offered to do is get me a fixed interest loan and pay off the IRS and the car. This would bring my mortgage payment up from $1762.80 to $2362.59/mo. It also cuts my payments on my house from a remaining 16 years to a 15 year loan. It also reduces my interest rate from 7.75% to 6.39%. The bad part is they are charging 2 points and approx $9000 in fees and closing costs.
On first look basis, I think it's a good idea. This bring in approx $877/mo in expendable income. Here's where I'm getting confused. If I hang it out until May 2005, I will have the IRS paid off. Which in itself gives me $800/mo more without adding $70,000 to my mortgage. Of course I will still need to pay my car payment.
I'm really confused and don't know if this is a good idea or if I should just suffer through and not add to my mortgage.
I'm also trying to get my credit repaired and refinancing would put me on the road to that end.
HELP!!!
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