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by CareyBot

(This is part 2 of a three-part series. See part 1.) This is the second of three articles on how borrowers who anticipate that they soon will be unable to make their mortgage payments can make the best of a bad situation. This article applies to borrowers with significant equity in their homes whose payment problems are caused or aggravated by a heavy burden of non-mortgage debt. Borrowers in this predicament may be able to extricate themselves by consolidating their non-mortgage debt into a new mortgage. An alternative is consolidation under a Chapter 13 bankruptcy. The advantage of being your own consolidator is that you stay in charge of your finances, and your credit rating is not materially affected. The disadvantage is that you lose the partial-debt burden relief that a Chapter 13 ...