Historically low mortgage rates give you the opportunity to get cash for debt consolidation by refinancing your home loan.
With mortgage rates between 3 and 4 percent, and credit card interest rates over 15 percent, it may make sense for you to get cash out of your home equity to pay off that high-interest debt.
What would be my new monthly payment after a debt consolidation refinance?
Your exact monthly payment depends on the interest rate you qualify for, the term you select, and the amount of debt you want to pay off. Contact us to review your options and calculate your new payment.
What are current refinance rates today?
Refinance interest rates vary depending on your credit, income, and other factors. Rates can change every day, so it’s smart to find out what rate you qualify for today.
Frequently Asked Questions
What are the advantages of refinancing to pay off debt?
- Reduce or eliminate high-interest debt in one fell swoop
- Lower overall interest payments
- Reduce taxes since mortgage interest payments may be deductible*
* Newfi does not provide tax or accounting advice. This website is not intended to provide, and should not be relied on for, tax advice. Consult your tax advisor before engaging in any borrowing transaction.
What are the disadvantages of refinancing to pay off debt?
- Your new mortgage balance will be larger than before
- You may have a higher monthly mortgage payment or pay more in interest overall if you increase your rate or loan term
- You may incur refinancing fees
- You may increase the time required to pay off your mortgage
How does refinancing to consolidate debt work?
With a debt consolidation refinance, you essentially take out a new loan that would cover your current mortgage balance plus the cash you need to pay any outstanding high-interest debt like credit card balances.
Since a refinance is similar to taking out a new loan, you may have to conduct another appraisal of your home. After the refinance closes, you pay off your old loan balance in its entirety, as well as your high-interest debt. You would then start making monthly mortgage payments on the new loan, as well as any of the other debt that was not paid off.