Cash-Out Refinance for Debt Relief
Tis the season for holiday cheer and planning for the new year! If one of your goals in the new year is to get out of debt, we come with great news…If you’re a homeowner, consolidating debt to increase your cash flow is easier than you think. Home equity remains at record highs and just this week, mortgage rates hit the lowest point since September. Credit card balances are now at all time highs and the grey cloud of high interest debt is getting heavier and heavier. A cash out refinance is the perfect way for homeowners to eliminate high interest debt by using your homes equity. Let’s run a few numbers real quick: if you have a $400k mortgage at 3.5% and $50k of other cards and loans, the monthly expense would likely be around $3300/mo. So if you cash out, you’ll now have a mortgage of $450k somewhere around 6%, no other debt and the payment will be under $2700. That’s over $600 in monthly savings or over $7,000 per year. Nobody wants a 6% rate but if a 3.5% has you breaking the bank, maybe it’s time to look at your options.