U First or 2nd mortgage

**kimmy4433** · 08-04-2008, 11:33 AM

So we have enough equity in the house to borrow from our house to consolidate our bills. This would make the house payment (1st) 864.00 including our taxes and insurance (this would stay the same) and our 2nd mortgage payment would be 422 a month. Then we would only have our utilities. Should we do this or has anyone used U first program and found it to work? Basically you put your money in one of their accounts take out a HELOC then it pays your bills and your mortgage. I have no clue. Anyone use U first financial?

**Russ** · 08-04-2008, 11:36 AM

From experience - don't do it.

Looking at the debts in your sig, I think you can wipe some of those out pretty quickly with a snowball of $422/month.

**Greebo** · 08-04-2008, 11:51 AM

U First - is that the deal where you pay someone $3,500 bucks for software that does something you can do on your own for free?

Waste of money!

**Greebo** · 08-04-2008, 11:54 AM

How much is your house worth now, and how much do you owe?

**nodmicks** · 08-04-2008, 11:55 AM

I wouldn't. I'm a safety fiend. Ok I'm debt free but when I had lots of it I looked at it like this. If there was a job loss and something couldn't be paid:

on a cc they hound me~ bad but I wouldn't be homeless
on a car they could take it.~ I'd suck but I wouldn't be homeless

House it always first priority and I wouldn't want to make that payment bigger. In the event of job loss etc the bigger house payment would make it easier to get behind and lose the house. That is a biggy for me ~ I could be homeless.

For me it is all safety and risk. I'd rather have as little risk with the mortgage as possible

**kimmy4433** · 08-04-2008, 11:57 AM

That is what I thought too. DH seems to think different. I think we should just keep trying to snowball our selves for 6 months and see where we are at.

I do have one more question. Do you take the balance of your $$ after bills each week and put them in a seprate account to then send to cc#1 at the end of the month? ie 150.00 left over from 1st check, 200.00 from 2nd, 100. from 3rd, and 300 from 4th to total 750.00 at the end of the month to use to snowball. We are really bad with our spending and that is another reason I don't think a HEL or U first would help us, that it would just make it worse.

Greebo yes that is the $3500 thingy. YUCK

**GM97** · 08-04-2008, 11:59 AM

Personally, I would not get a HELOC. You may run the risk of using your credit cards again inappropriately. It might end up you having mortgage, HELOC and piling credit cards. Just pay your cards with the highest interest and minimum on the others, but before doing this, cut all your cards but one.

**Russ** · 08-04-2008, 12:00 PM

Originally Posted by kimmy4433

. We are really bad with our spending and that is another reason I don't think a HEL or U first would help us, that it would just make it worse.

You BOTH need to get this under control. Having more money won't help if it is not.

You need to start tracking your expenses so you know for certain how much you can snowball. You also BOTH need to sit down and come up with a budget.

**Greebo** · 08-04-2008, 12:06 PM

Borrowing money to pay off debt won't work unless you fix your financial bad habits first. Otherwise you'll just end up borrowing again, and again, and again, and have no equity AND 30k in credit card debt. That's where I was in June of 2006.

In June of 2k06, I turned over my credit cards to my wife, refinanced my house, put 30k of cc debt onto my mortgage, and limited myself to one CC with a limit of $1,500.

Guess what I did then? STILL carried a balance of about 1k from month to month.

Consolidation CAN help but you have to KILL access to other forms of debt FIRST. If you're both bad at spending, that means cutting them up completely.

I strongly suggest you AND DH watch Dave Ramsey's Live Event Online - $30. A bargain for the knowledge therein. Then buy and read his book, "The Total Money Makeover". If you both get on board you can clean this mess up on your own without scam crutch systems that don't address the fundamental problems.

**FrugalMomof3** · 08-04-2008, 12:06 PM

Dont do it! Take that $422 a month and snowball it! HELOC's are terrible, we had one and NEVER again will we get one... surely not worth the headache.

**kimmy4433** · 08-04-2008, 12:13 PM

Our house is worth 150,000 and we owe 117,000. Ok thank you everyone you have all stated what I thought!! DON'T DO EITHER!!

**Wendy99** · 08-08-2008, 10:41 AM

I refianced our mortgage 2x to get rid of debt, never again .. I know thats different from a HELC, but still lesson learned . shuffling debt around does NOT get rid of it .. I agree with you and the rest, just snowball .. I've learned SO MUCH lately and if I had this knowledge when DH and I were just starting out we would be in such a difference place right now ...

**MTS04** · 08-08-2008, 03:14 PM

Ummm...do you realize that a Home Equity line is abbreviated HEL.
HEL is also the first 3 letters of the word HELL. Don't do it. Keep snow balling. If I am reading your siggie right. If you keep snow balling, Target and Home depot and BOA are gone next month with a snowball of 422 and the ArtVan would be gone the next month or 2 after. Keep snowballing. You're list will keep getting smaller.
You're going in the right direction. Have patience, you can do it!