The As Is Situation - the house and our second mistake

I am the sole earner for the family and I make, but most standards I believe, good money. Low six figures.

But a couple of years ago, I didn't make quite that much and my wife found a great job with a real estate company. We decided to refinance our second mortgage and replace that interest only loan with a traditional mortgage.

*Admission* - I don't even know our interest rate on that loan!

We were carrying a lot of credit card debt at the time and thought - hey, we are smart and disciplined enough to cash in equity (which we had at that time...in fact we had about $xx,000 in equity), that we can pay off our credit card debt AND do some nice things to the house.

Now fast forward to today. We paid off our that old debt and kept some extra money in the bank. But now our monthly house note is $xx00 dollars. And this is the death trap - we've accumulated another xx,000 plus dollars in credit card debt! So instead of using any extra money to pay down the new mortgage, we got right back in to our old free spending routine and landed ourselves in a much more dire situation. In fact, the interest alone on our credit card debt could be hammering away at the second mortgage.

We are in what I call the "Equity to Credit Card Death Spiral."

Our second mistake:
We increased our housing debt burden and rather than take measures to pay that down, we increased our credit card debt again!