Loan Articles

There’s no getting around the fact that this particular point in time is difficult and stressful. Employers are cutting jobs right and left and/or resorting to other measures to keep their companies afloat. A few years ago, the idea of being asked to take a pay cut or give up benefits in order to avoid being laid off would have been seen as a threat, or strong-arming by the employer. Today, it is often a good-faith gesture to try to help everyone get through, much like rationing food to make what we have last-- hurting everyone a little to avoid hurting anyone a lot.

While this kind of solution does have the benefit of keeping more people employed and, hopefully, holding on until the crisis is over, even some of the lesser hurts can put a family at risk. What if I have health problems? Certainly it’s better to lose some benefits than to lose them all, but I how do I cope with the shortfall? What if my spouse is in the same danger, or worse, has an employer who would rather take the short-term way of simply slashing staff rather than trying to come up with a compromise?

In a period of crisis, we are encouraged to use all the assets we have, and one of those is the home. While borrowing on one’s house may not seem like the ideal, a mortgage loan or mortgage refinancing is far better than trying to live off of credit cards. Utilizing a mortgage option can also be a way to pay off those credit cards while benefiting from a lower interest rate, reducing overall debt and decreasing monthly outlay.

As mentioned, this may also be a time to think about re-financing one’s home. As much as it may seem like it, a bank doesn’t really want to foreclose--as doing so costs them more money in the long run. There are many different financing programs and other options for mortgage loan modification worth investigating and with interest rates going down, refinancing a mortgage can at least provide a short term solution to reducing monthly payments.

Taking out a new mortgage, a second mortgage, or refinancing an existing one can all be ways of managing your debt and life in precarious financial times. It is important to investigate all of the options and go into the process carefully, but a lower interest rate or use of escrow may be what is needed to get through until things improve