Florida Bankruptcy Lawyers on Refinancing Debt

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Monday, October 12th, 2009 Subscribe To Our Feed

Credit card companies and finance companies glean a good deal of their business from people who find themselves miring deeper in debt and seeking a way out. Refinancing is a way of making the equity you have accumulated in your home work for you and a way to reduce the interest on credit cards. But, the information is unclear. This company offers this deal and that company offers another. When is refinancing a good idea? Florida bankruptcy attorneys offer the following information for your benefit in the event bankruptcy is your best choice.

Your Home
•    If you can refinance your home for the same amount of time left on your original mortgage or a lower interest rate and without overwhelming additional fees, then do it.
•    If you have a bank loan and can refinance with another bank loan with all of the above conditions included, then do it.
•    If you can refinance your home for substantially less than its market value and come out with substantial cash to apply to other areas, then do it.

Your Credit Cards
•    If you can refinance your credit card balances for a lower interest rate and have all the other terms of the loan similar, then do it.
•    If you are not in default on your mortgage or in financial trouble and a refinance on your house to pay off high interest credit card debt has tax advantages, a lower interest rate on the mortgage and the loan is for the same or less than the length of time left on the initial loan, then do it. A word of warning though, DON’T refinance your home solely to pay off credit card debt unless there are advantages for the cost of the mortgage as well.
•    If you can shift your credit card debt to another company for less interest and no fees associated with the transfer, then do it.

Don’t:
Do not let a tenacious creditor talk you into refinancing to satisfy their debt. These people are trained in the art of intimidation and they’re very good at it. However, their parent company is often reluctant to pursue debt through the court system and they are left only with the option to intimidate. This debt can be negotiated better through a credit counselor or by reaching the debtor directly. Let Florida bankruptcy attorneys help you with these contacts and in selecting a credit counselor.

Do not refinance your credit card debit with a loan you have secured with tangible property, such as your home or vehicles. You may be putting these previously unencumbered assets into jeopardy if you have to default on the credit card balances or declare bankruptcy. Contact FL bankruptcy lawyers for more information on how a refinance can help you if you decide to declare bankruptcy.

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