For example, debt consolidation loans may have high hidden costs and may require your home as collateral. An unscrupulous company may misrepresent the terms of such loan agreements and borrowers my not even be aware that they may lose their home. No one should feel they have to risk everything they own to settle debts. For example, unsecured loans may include money you borrowed from a finance company where you did not sign a security agreement, money borrowed from friends or relatives, as well as some education loans, credit and charge cards, legal, medical, or accounting bills. Similarly, a home equity line is a form of revolving credit in which your home also serves as collateral.
Many lenders offer home refinancing and home equity lines of credit.
Before making the decision to refinance or take out a home equity line of credit you should weigh carefully the risks against the benefits. Consolidated's Debt Management Program may be able to resolve your debt in 3 to 5 years, whereas you might be paying a secured loan off for 15 years or more. Remember, failure to repay the loan could mean the loss of your home. Home Equity Line Costs Many of the costs in arranging a home equity line of credit may resemble the charges you pay when you buy a home. An application fee, which may not be refundable if you are turned down for credit.