Debt consolidating home equity mortgage
Home equity loans come in two major types a standard home equity loan and a home equity line of credit (HELOC).
Of course, this approach requires that you have fairly good credit - if your FICO credit score is in the mid-600s or lower, you may have trouble getting such a loan from a bank or credit union.
Second, you may be able to set up a consolidation loan that lets you pay off your debt over a longer time than your current creditors will allow, so you can make smaller payments each month.
That's particularly helpful if you can combine it with a lower interest rate as well. Basically, you borrow a single, lump sum of cash that's used to pay off all your other debts.
This makes them useful for situations where you need money for periodic expenditures, such as home improvement projects, but there's nothing to stop you from simply making a one-time draw to consolidate your debts.
There are a couple reasons you might opt for a HELOC debt-consolidation loan rather than a standard home equity loan.