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REVIEW of Money 03
Mortgages - Re-finance and Make Them Work for You

The struggle to make ends meet on a fixed income is a common problem. Taking out loans to pay for high-priced necessities is an aspect of life that is taken for granted. The strain on the budget, however, can be eased with some basic changes that anyone can make. Not all banks and loan societies are the same, and a few enquiries will make it clear that variations in banking practices can be used to advantage. By comparing one with another, it could be that the particular institution a customer originally signed up with is no longer offering the best deal; and it isn't hard to transfer existing loans to an account better suited, or even to a different bank altogether.

All lending institutions are hungry. They want your juicy carrot, and if you happen to have more than one in the bag, they will seriously consider bending the rules to take on the bunch. Negotiating a single loan which incorporates everything owed means just a single monthly payment for the lot; and quite often it will turn out cheaper than before. You can make that happen by shopping around for the best deal; playing one off against the other; and doing it in person, face to face - the real truth is easier seen that way.

Aim to re-finance by having all loans incorporated into one. Include an amount to pay off any credit cards, and add some extra for working capital and rainy-day money. Also, and if possible, try for an account with a re-draw facility. This is a loan-repayment account directly linked with the working account into which all income is paid. The current balance is weighed against the loan, reducing the balance of what is owed and interest charged against it. That's all the time it stays there, so keeping as much in the account as possible is essential. This can be helped by using credit-cards to advantage. Once cleared by the re-financing, use them to pay everything you can, thus leaving cash in the bank; but make sure they are all paid in full before the due date to avoid interest charges.

You may still have to keep a rein on spending, but re-financing should make life considerably easier and less stressful.

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