Debt restructuring through a mortgage broker

A mortgage broker can offer a ray of hope for consumers with bad credit that are hoping to restructure their debt. In such instances, consumers may be able to securitize credit card or other unsecured debts with the equity in their homes with a broker's help.

Compare Credit Cards for Bad CreditWhen a consumer with bad credit is struggling with a serious debt load but owns their own home, seeking out a mortgage broker can be a good option. This is because a mortgage broker can communicate the consumer's circumstances to various lenders more efficiently than the person could on his or her own.

In order to get the loan approved, the lender first needs to have an understanding of the potential borrower's situation.

Consumers with bad credit who are hoping to restructure their debt may want to seek out a mortgage broker that will outline how much their services cost before they are ever retained. Many brokers will instead make their money by adding a markup to prices they are given by wholesale lenders.

Borrowers with bad credit who secure their loan with their home equity will end up paying a higher interest rate.

Although unsecured creditors can be paid off in this manner, individuals with bad debt will need to make sure they don't fall back into bad habits. If they do, they could end up losing their home.

Consumers that are considering a bankruptcy due to the scope of their debt should speak with a bankruptcy attorney before securitizing their debts.

Join the discussion
We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

The editorial content on is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company's business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.

Weekly newsletter
Get the latest news, advice, articles and tips delivered to your inbox. It's FREE.

Updated: 11-22-2017