A Common Scenario I See

A Washington homeowner comes to me carrying a significant amount of high-interest credit card debt. Their credit score is below 600. On paper, it doesn’t look promising. With credit card interest rates averaging over 20% APR — and often higher for borrowers with lower credit scores — it’s easy to see how balances grow faster than payments can keep up. Minimum payments barely cover the interest, let alone reduce the principal. But they have something working in their favor: substantial equity built up in their home over time. [Read more…]