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December 06, 2006
Second Mortgage Loans Versus Compounding Credit Card
Many people argue that the repayment period for a closed-end second mortgage is longer than that of credit cards. But, with penalty rates and fees tacked onto the compounding interest, many consumers are getting caught in the spiral of "negative amortization," which is what regulators call it when consumers make payments but balances continue to grow because of penalty costs. The new bankruptcy laws forced credit card companies to double their minimum payments, but that's not enough to reduce the principal quickly enough for people to pay their balances off in a timely manner. Instead, their balances continue to grow. So, it makes sense to go ahead and use the equity in your home to end this cycle by paying off credit cards with a closed-end second
From Second Mortgage Loans Versus Compounding Credit Card
Posted by Tom at December 6, 2006 02:20 PM
