The money you can borrow on the one hand will have a lower interest rate than other loan sources and can help reduce your monthly repayments to clear other expensive debt. Spreading the term of repayment over a longer period will make an impact on reducing your monthly debt.
From your budget determined how much outstanding debt you are paying. Next calculate what the payments would be under one loan against your house if they were all consolidated. The best decision to make will show to help you control your debts more easily.
If house prices are rising in your area, your increased equity in the house will allow you to borrow against it since the date of your original mortgage.
If you are already struggling to make a mortgage payment, then the downside loan refinancing will put your house on the line and at risk losing it. If if it looks eminent that the bank will foreclose on your loan then it would not be wise to increase your borrowings.
If your calculated payment will not make the additional mortgage payments then it may be better to sell off other items that had been borrowed against to decrease debt elsewhere instead of possibly losing your home.
Another option would be to downsize on your home and buy a house of lower value to reduce your mortgage amount while you are getting back on your feet.
For most people the home is the most valuable asset and always do all you can to keep ownership of it. And carefully considering all your options before borrowing against your house will save you the embarrassment of losing your home.
Adam Till enjoys freelance writer and internet entrepreneur.
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