Renewal Coming Up? Don't Just Sign.
Debt consolidation rolls credit cards, loans and lines of credit into your mortgage at a far lower rate, turning several payments into one. Renewal is the cleanest moment to do it, because there is no penalty to break the mortgage. Most clients cut total monthly payments by several hundred dollars.
Who this is for
- You are carrying credit cards at 20% or more and the balances are not going down.
- Your renewal is within 12 months and you want to restructure, not just re-rate.
- You have five or six payments a month and no clear picture of what you actually owe.
- A car loan or line of credit is eating cash flow you need elsewhere.
- You have at least 20% equity in your home, or close to it.
- You want one payment, one date, and a payoff timeline you can see.
How it works
- 1
We list every debt
Balance, rate, minimum payment and remaining term for each one. Most people are surprised by the total interest number once it is on a single page.
- 2
We check your equity and timing
Consolidating usually needs the new mortgage to stay within 80% of the home's value. If your renewal is close, we time it so there is no penalty at all.
- 3
We calculate the penalty if you cannot wait
Breaking a fixed mortgage mid-term can trigger an interest rate differential penalty. Sometimes the savings still justify it, sometimes a second mortgage is cheaper. You see both.
- 4
One application, multiple lenders
I place the file where it will actually be approved, whether that is a bank, a credit union or a near-prime lender if credit has taken a hit.
- 5
Appraisal and approval
An appraisal confirms value, conditions are cleared, and the lender issues final approval, usually within two to four weeks.
- 6
The lawyer pays the creditors directly
Funds go straight from your lawyer to each creditor, so nothing is missed and the accounts close properly. You start the next month with one payment.
Before and After: Five Payments Become One
A typical consolidation. Five separate payments totalling $2,400 a month become one mortgage payment of $1,650.
| Payment | Before | After |
|---|---|---|
| Credit card (19.99%) | $750/mo | Paid off |
| Second credit card (22.99%) | $480/mo | Paid off |
| Car loan | $610/mo | Paid off |
| Line of credit | $320/mo | Paid off |
| Personal loan | $240/mo | Paid off |
| New consolidated mortgage payment | — | $1,650/mo |
| Total monthly | $2,400/mo | $1,650/mo |
That is $750 back every month, with one payment and one date. Example only; your numbers depend on balances, rate and amortization.
Run your own numbers
This is a quick estimate for planning purposes and does not include taxes, condo fees, insurance, or lender-specific qualification rules.
Estimated Monthly Payment
$3,007
What it costs
| Cost | Typical range | What it is |
|---|---|---|
| Broker fee (prime lender) | $0 | The lender pays me when your mortgage funds. Most consolidations at renewal cost you nothing in broker fees. |
| Appraisal | $400 to $700 | Required so the lender can confirm current value and available equity. |
| Legal fees and disbursements | $1,200 to $2,000 | Registering the new mortgage, title search and title insurance. |
| Discharge fee | $275 to $400 | Charged by your existing lender when the old mortgage is paid out. |
| Prepayment penalty | $0 at renewal | Nothing if you consolidate at renewal. Mid-term, expect three months of interest on a variable, or the interest rate differential on a fixed. |
| Near-prime lender fee | 0.5% to 1.5% | Only if credit or income means a prime lender is not available. Usually added to the mortgage. |
Most closing costs can be rolled into the new mortgage, so the majority of clients consolidate without paying anything up front.
Real numbers
Five payments into one
- Home value
- $880,000
- Mortgage at renewal
- $395,000
- Credit cards, car loan, line of credit
- $97,000
- New mortgage (4.49%, 25 years)
- $495,000
- Total monthly payments before
- $4,880
- Total monthly payment after
- $2,745
About $2,135 a month back, with one payment and one date instead of five.
Mid-term, penalty included
- Home value
- $690,000
- Mortgage balance
- $330,000
- Penalty to break
- $6,900
- Debt consolidated
- $61,000
- Monthly outflow before / after
- $3,940 / $2,520
The penalty was recovered in under five months of savings, so waiting for renewal would have cost more than breaking.
Illustrative examples only. Your actual rate, payment and costs depend on your credit, income, property and the lender you qualify with.
FAQs
How much debt can I roll into my mortgage?
Enough to bring the total mortgage up to 80% of your home's appraised value with a prime lender, or up to 85% with an alternative or second mortgage lender.
Should I wait for my renewal date?
If it is within a few months, usually yes, because there is no penalty at renewal. If the interest you are paying now exceeds the penalty, breaking early can still be the better move. I run both numbers.
Will consolidating hurt my credit score?
There is a small short-term dip from the new mortgage inquiry, then most clients improve because revolving balances drop to zero. Utilization is one of the largest factors in your score.
Can I consolidate if my credit is already damaged?
Often yes. Alternative lenders weigh equity more heavily than score. The rate is higher, so we pair it with a written plan to move back to a prime lender within one to two years.
Am I not just stretching short-term debt over 25 years?
You are, unless you keep paying the old amount. The right approach is to take the lower required payment and then use prepayment privileges to clear that portion in three to five years. I set that up with you.
Do I have to close my credit cards?
Some lenders require certain accounts to be closed as a condition of approval. Otherwise I generally recommend keeping one or two open with zero balances, because closing old accounts can lower your score.
Does my spouse need to be on the application?
If they are on title, yes. If only one of you is on title, we can often qualify on one income, though including both usually improves the ratios.
How long does the whole process take?
Typically two to four weeks from application to funding, and faster at renewal when no penalty calculation or discharge negotiation is needed.