A 49-year-old single parent was struggling to make ends meet after overtime hours at work were eliminated, significantly reducing household income. As a result, credit cards became maxed out, and only minimum payments could be made. One credit card ultimately charged off because the required payment was no longer affordable.
When the member reached out to discuss her situation, we explored the option of refinancing her mortgage. She was initially hesitant because current mortgage rates were higher than the rate on her existing loan. After reviewing the full financial picture, I was able to show her that refinancing at a higher interest rate while paying off unsecured debt would put her in a stronger overall position. The new mortgage payment resulted in savings of more than $450 per month.
Through the refinance, we paid off all unsecured debt, helped negotiate a settlement on the charged-off credit card that saved her more than $3,000, and provided approximately $10,000 to be placed into her savings account. Even with the higher interest rate, the monthly savings helped offset the loss of income from overtime hours.
Ultimately, the member was very happy with the outcome. Nova Credit Union was able to place her in a stronger financial position with reduced stress and a clear path to improving her credit. She remains grateful for the support and frequently shares her story with other members and individuals in her community.
