Current on mortgage, but right on the edge

BY ILYCE GLINK AND SAMUEL J. TAMKIN Tribune Media Services

Question: I am currently paying on a mortgage that is becoming an overwhelming expense and causing me to go further in debt in other places.

I have a 30-year fixed mortgage with private mortgage insurance (PMI) with a balance of about $290,000. I have 26 years remaining on the loan with an interest rate of 6.625%.

I am current on the loan, but I’m borrowing on credit cards to pay my bills. I tried the loan modification process, which went from July 2010 through March 2011, only to be denied. I also tried to see about refinancing but I am so upside down with this loan that I would have to come up with about $60,000, which I don’t have.

I love my house and would like to stay here, but I don’t see the economy or housing market getting any better any time soon. I haven’t looked deep into anything specifically after the denial of the loan modification, but I’ve got to do something or everything is going to go down the tubes.

Do you have any suggestions?

Answer: It seems to us that a refinancing of your home mortgage at this point may not help enough to get you out of your hole.

Let’s say you can reduce your mortgage interest rate by two or three percentage points, and that will reduce your monthly mortgage payments by about $750. Is that enough to make the difference?

While that $750 per month is significant, you would still need to find the money to pay down your credit card debt and pay all of your other expenses.

You really need to sit down and go over all of your debts, review your monthly expenses and understand how much money is coming into and going out of your household before you make any decisions.

If $750 is a game-changer, and you are current on your mortgage, then you might want to pursue refinancing through the

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