A cheaper debt consolidation alternative is to consolidate your high interest debt into your home loan. However, if you decided to follow this route your next goal should be to pay off your home loan debt as soon as possible.
It’s does not make financial sense to consolidate credit card debt into your mortgage loan and then to stretch out those payments over a 20-year period. Sure, it will improve your immediate cash flow, but over the long term you will lose a lot of money.
Another mistake you should avoid is to finance nonessentials like overseas holidays with your equity you have build up over time. It makes no sense for example to pay for a 2-week overseas holiday until the day you’re old and gray.
Home Loan Tips
Interest rates are on the way down and a good strategy would be to maintain your current payments. This way you can pay off your home loan quicker without it having such great impact on your lifestyle.
Instead of spending your bonus at the end of the year, why not making a lump sum payment into your bond. Since interest rates are calculated daily, you can reduce the interest you have to pay by linking your cheque account with your bond account and paying your salary into that account
Another idea is to deposit your VAT payments into your access bond which will help you to save even more on home loan interest.
For more useful and huge interest saving tips and information visit my website on: http://www.gpfmortgage.co.za/sa-home-loans.html
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