Current Mortgage Rates

Tuesday, October 14, 2008



No, Debt consolidation is debt management, not debt elimination. Moving all your outstanding loan balances to one lender will not reduce the amount you owe. You must ultimately pay off the loan and pay interest until the loan is repaid. Your goal should be using debt wisely. Why, because there are some disadvantages you need to consider. Some lenders charge a penalty fee (early repayment charge) if a loan if repaid early. These charges can be significant and need to be taken into consideration when deciding whether to pay off your existing debt with a consolidation loan.

When you take out a debt consolidation loan you might have to pay a broker fee. Lower monthly payments are normally because the debt is repaid over a longer period of time. Borrowers are therefore likely to pay more in interest charges in the longer term and have the debt for a longer period. If unsecured debts such as credit cards are consolidated with a secured loan, the risk to the borrower is greater. If they encounter repayment problems they would risk losing their property. Many lenders add payment protection insurance (PPI) on their loans, sometimes without borrowers fully understanding what it is. Payment protection insurance cover is usually expensive. If you don't change your spending habits, and reorder your priorities. The consolidation might make you poorer or you might loose your house.



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Current Mortgage Rates*

Loan Type
National Average
30-yr. fixed6.25%
30-yr. fixed jumbo7.62%
15-yr. fixed5.88%
15-yr. fixed jumbo7.12%
7/1 ARM6.62%
5/1 ARM6.38%
3/1 ARM6.25%
1-yr. ARM5.88%
1-yr. LIBOR ARM6.25%
10/1 ARM8.38%
40-yr. fixed7.12%
*Mortgage Rates Updated: 10/12/2008