If you’re struggling with debt, you’re not alone. Debt can be incredibly stressful and make it seem like there’s no way out. But there is light at the end of the tunnel. One way to get out of debt is by refinancing your home.
Refinancing is taking out a new loan to pay off an existing loan. The new loan will have different terms than the old one, which can include a lower interest rate, a different length of time, or both. When you refinance your home, you can use the equity you’ve built up in your home to get a lower interest rate and monthly payment. This can help you get out of debt faster.
Credit card interest rates are notoriously high, often exceeding 20% APR. This can make it difficult to pay off your balance, particularly if you’re only making the minimum payment each month. Home loan rates, on the other hand, are typically much lower, often in the 4-5% range. If you’re carrying a balance on your credit cards, you may want to consider refinancing into a single home loan payment. This can help free up cash flow so that you can focus that extra money on savings or retirement or paying down additional debt. Plus, the lower interest rate will save you money in the long run. For many people, refinancing can be a great way to save money and simplify their finances.
If you extend the term of your loan, you may also lower your monthly payments. This may free up some cash in the short term that you can use to pay off your debts. Refinancing can give you some breathing room if you’re struggling to make ends meet each month. If you can lower your monthly payments, it will be easier to keep up with your other bills and expenses.
If you’re interested in refinancing your home to get out of debt, the first step is to contact a mortgage lender or broker. They’ll be able to help you determine if refinancing is right for you and guide you through the process. Once you’ve found a lender or broker you trust, they’ll order an appraisal of your home so they can determine how much equity you have. They’ll also pull your credit report and look at your income and debts.
If you’re struggling with debt, there are options available to help you get back on track. Refinancing your home is one such option that can help reduce your monthly payments and get you out of debt faster. If this sounds like something that could work for you, or if you’re looking to take the next step, I’d love to help! Send me an e-mail at edavis@guildmortgage.net and let’s get started!
