Consolidating mortgage loans into one
If you have a number of debts, you may wish to merge them all into one loan. There may be a number of reasons why you would wish to do this.Below are the most common reasons: To learn more about what debt consolidation is and how it works in Canada, click here.However, if you don't create a monthly spending plan and budget your money, it's very easy to continue relying on credit and get further into debt rather than get out of debt.If your bank or credit union can’t help you, then see if maybe a family member or friend is able to lend you the money necessary to consolidate your debts.If a relative lends you money, but then you lose your job or get hurt and are unable to pay them back, that may sour your relationship with them.If your relative can’t afford to forgive the loan to save their relationship with you, then this could forever cast a shadow over your relationship with them.Maybe your relative’s finances are tight right now—even though they may look successful to you.Lending money to family members involves added risks.
This may be another reason why a relative may not be willing to lend you money. If a relative is able to lend you money, then make sure that you honour your agreement with them and always make your payments on time as agreed.If none of the above options will work for you, you can speak with a Credit Counsellor to see what other options may be available to you.You may qualify for a debt management program or orderly payment of debts program (depending on your province).If you do choose to go this route, you should make sure that you try to pay off this extra mortgage as quickly as possible and don’t do this very often.If you find yourself doing this every year or two, that means that you are spending more than you make, and it is going to take forever to get your mortgage paid off at this rate.
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So if you ask your bank for a debt consolidation loan of $20,000, but your net worth is only $20,000, they will probably decline your request.