Can I refinance my current Home equity and take out the additional equity to use to pay off my credit card debt?
I already have a 30 year fixed mortgage that I owe 20 years 3.9 %(bal 200,000) and a Home equity that I owe 10 years 6% (bal 60,000). I'm not sure but think the house should appraise for 325,000 to 350,000. When I went to bank they suggested I consolidate all into a 30 year mortgage and I am just not sure that is the way to go. Was wondering if it would make more sense to just refinance the home equity loan and add the cc debt to it to make the payments more affordable. Any suggestions would be much appreciated .
Ok ty for getting back to me. I checked with the primary mortgage co. In 2011 I had home modification loan and locked in at 3.9 for 5 years then as if dec 2016 it will be locked at 4.09 for length of loan due to mature 10/2033. No PMI and no pointsThe Home equity is actually fixed at 6.84% and matures July 2020 no points no pmi. (The line was for 112,000 and owe about 57,000)Currently just in beginning steps of determining if total refi with addition of 32000 medical/cc debt would be best. Just uneasy bc I was told rate would be most likey 5 percent fixed for 30 years plus additional closing cost of 8800 and another 1000. To reduce interest rate or something. All so confusing. Anyway I called back to the home equity line bank today and was told that due to the banking crash a few years back that they locked all revolving home equity lines and left it locked so no money could be re borrowed off of the original line. However she mentioned that I can request a review of my acct and that if all is good with my credit hx then they could release some or all of the line that was once blocked at no additional cost except for the new release of the line payments. So I'm leaning toward that because I feel that would help me pay down the credit card but not lock me in for 30 years again. My credit score ranges 688-702. The only thing is that int rate on HELOC is a bit high but still much better then my cc rates. Ok hope I didn't overwhelm you with all this info I just got my self in a financial bind and want to take care of it in a way that helps me and not make it worse for me Ty again for taking time to review this.
Yvonne Lutz (YvonneLutz)
#119 ranked lender in New York - 11 contributions
Getting them to open up your line of credit would be your best option because your rate on your first is about where they are currently and it is a fair rate for a fixed HELOC. Therefore, you could save a lot in closing costs. There are obviously ways around closing costs, however, that just increases your rate often. I would try getting them to open your line of credit, if you do not have luck, I would be more than happy to see how I can help. You can either call me at 877-257-7423 or email me at lutz@libertyhomefunding.com. Good Luck!!
Steven Ceceri (123LoanYes)
#12 ranked lender in Rhode Island - 723 contributions
For any refinance, you need to take into consideration the new costs that will be added to your loan amount and you need to be sure that you keep your loan to value at 80% or less to avoid mortgage insurance. The lower the loan to value, the lower the rate will be. You will have some tax advantages (potentially) by having a higher mortgage interest deduction, which will come from a larger loan amount. Freeing up your credit card balances will likely improve your credit scores as well. My suggestion would be that you set a specific goal for yourself if you do consider refinancing your credit cards into 1 new loan. That goal should be to take the same payments you are making now and apply that payment to your new mortgage payment, which will help pay down your mortgage quicker. Try to only use your credit cards for simple purchases, such as groceries or getting gas to keep them active, but pay the balance off each month to avoid interest charges. I wish you good luck moving ahead!
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