Have you ever asked the question, “Can I refinance my home to pay off credit card debt?”
If so, you are not alone. Credit card debt consolidation is very popular these days and refinancing your home to pay off your credit cards is one method to do that. It is not always recommended, but for some it might be the solution, depending on the situation.
In the video below, Don took a few moments to answer this very question. He covers some of the pluses and minuses of why you would or would not want to use the equity in your home to consolidate your credit card debts.
Take a few moments to watch this video and hopefully it will give you some insight into the process and if it is right for you.
Here is a quick synopsis of what Don covered in the video. There are three types of loans you can get that involve the equity in your home to pay off credit card debt. They are:
- Cash-out Refinance of your first mortgage as long as you have 20% equity in your home.
- Closed end second mortgage on your home. This is a fixed rate second mortgage against the equity in your home.
- HELOC or Home Equity Line Of Credit, this is basically a loan against the equity in your home that can be used when needed for a certain period of time.
The big thing you need to find out is if this is right for you in your situation. Find a financial advisor or speak with a highly qualified loan consultant, who has your best interest, to see if this would be the best option for you. Remember, just because you can do it doesn’t mean it is the right thing to do.
Rolling all your credit card debt into your home loan so you can go back out and jack up your credit cards again would not be advised. Learn how to be in control of you finances and live a better and fuller life.
If you have a bunch of credit card debt you know what I mean. It can be your ball and chain. Time to break free!
If you have any questions, please feel free to contact us via our contact form or give Don a call at (417) 844-5370. We are here to help!