Even with mortgage rates rising slightly, you can still find a mortgage refinance that will benefit your financial situation. Many homeowners find themselves with debt from student loans, car payments, medical bills or credit card expenditures; but by consolidating those into your home mortgage, you can lower your monthly payments.
By refinancing your mortgage and consolidating other debts such as credit cards and student loans within the mortgage, you can improve your credit rating as well as increase the amount of cash you have on hand. While your monthly mortgage payments may increase, your overall monthly output toward your debt will decrease. The less revolving debt and fewer personal loans that you have in your name, the higher your credit score will rise. Additionally, by paying off the debts with higher interest rates, you can save hundreds of dollars per month in payments.
When you have paid down your home significantly, often more than 20%, and still have revolving debt, debt consolidation within your mortgage could be the solution for you. You can make one monthly payment instead of several and pay less overall every month. Unlike credit cards, the interest on your mortgage is often tax deductible.
For some with erratic spending habits, consolidating your debt may not be the solution, as it will not change spending habits. Once the credit accounts are closed, they must stay this way in order for it to have a positive effect on your credit. If you open additional accounts and run up the balances, your credit score will decrease.
Call me today to set up an appointment! I would love to review your finances and help you determine if a debt consolidation refinance is right for you.