Home Loans Tips: Reduce Your Debt
Debt, it’s surprising how quickly it can grow – sneaking up on us and before you know it we’re suck under a pile of debts struggling from month-to-month.
In his best seller, Rich Dad Poor Dad, Robert Kiyosaki explains that the only way to measure your wealth is by calculating how long you can continue to live as you are currently if you should loose your job or income. How wealthy are you then?
In South Africa Debts are consuming most of our income every month but by using one of your big financial tools – YOUR HOME LOAN – you can begin to take control of those debts.
Your home loan is most probably your biggest debt currently but it is also the one thing can you can use to lower your overall debts.
By using the value you’ve accumulated in your property over time you can consolidate all, more or some of your debts into one low interest account by applying for a 2nd Bond, Re-advance or a Further Loan from your existing bank.
Though you home loan you can borrow enough cash to payoff you car, credit cards and personal loans. Because you’re borrowing through your bond the interest charged on the funds are much lower and the repayment term is extended – which results in much lower monthly debt repayments.
There is really no reason to have an outstanding Personal Loan or Huge Credit Card debt if you’re able to use funds from your Bond to pay it off.