With many nationally acclaimed experts predicting a fairly significant drop in home values this year, a few of our past clients are moving forward with plans to take cash out of their homes using a ‘cash out refinance’ right now while values are still relatively high. So I know what you’re thinking right now; Bob, there is no WAY that I’m giving up the super low-interest rate you arranged for me on our last loan. And I agree that for many if not most of you reading this, holding on to your current loan is your best option. But for some of you, your need for debt consolidation, home improvement, and funds for college tuition or health care outweigh the benefit of holding on to your current loan and low-interest rate, and here’s why.
Every $10,000 of credit card debt averages a minimum payment of $300/month. In other words, you’ll at least pay the interest on this debt though you won’t reduce the balance much if at all. This same $10,000 only adds $60/month to a mortgage payment, saving the debtor $240/mo. Multiply this times 3 or 4 and the savings approach $1000/mo. Even at today’s higher interest rates, this math makes sense. The same can be said of auto or boat loans, personal loans, etc. Converting this debt to mortgage-secured debt lengthens the term it’s true, but gives dramatic relief when it comes to your monthly budget. Some of us need a ‘breather’ on occasion in our lives, and your equity in your home can be a lifesaver.
Again, this solution is NOT for everyone. But if you or a family member or friend need help, now is the time to reach out to me for a no-obligation review. Do it now before the equity in your home is possibly reduced as many experts are predicting. Next year, you may no longer have this option.
Please contact me at 480-257-9080 for a confidential consultation.