Debt Consolidation and Your Home Nobody can pin down the exact date when the concept of credit first saw the light of day, but it’s been a growth industry ever since, albeit in a strictly negative way, for some time. The number of loans, credit cards, and ways to borrow money has grown exponentially. Prospective applicants are regularly sent attractive proposals from banks and financial institutions, tempting them with various incentives and impressive interest rates. Tactics • •
You are given a grace period during which you won’t need to make any payments. You can be offered a number of interest-free months.
The Debt Spiral All these sound great. You will have the right intentions should you apply for any of these loans, but the fact is, your spending can get out of control and leave you with a number of loans to pay off or compounding credit card debt that gets worse every month. It can simply get too much for you and it becomes difficult to keep up with the payments. If you have a monthly budget, paying several creditors each month might see that budget take a reality hit! You thought you would have money left over each month after paying everything off, but you are left scratching your head wondering where the money got to and how you are going to pay all of your outstanding bills. Remember, you are paying interest on the credit card and the loan while trying to pay off the loan as well!