Refinancing Your Mortgage To Pay Off Debts


Get movin’! with Rocket Mortgage

We teamed up with our recommended lender Rocket Mortgage® to help you qualify for a loan and enjoy your dream home!

What do you want to do?

So you’re in your feels about buying a new home? πŸ’œ
Tell us a bit more about it.

Looking to refinance for a better rate or extra cash? πŸ’Έ
Don’t worry, MoneyTips has got you covered.

The property is a… What kind of property?
I intend to use it as my… How do you use it?

Fill in all details first to move on.

Sweet choice.πŸ‘Œ
Let’s find out when you are going to buy.

Help us find the best rate for you, on your schedule.

Help us find the best rate for you.

Have a second mortgage?
I’m planning to buy…
My credit score is… What’s your credit like?
Determining Your Credit Score
  1. Your credit score is a three-digit number that’s used to predict how likely it is you’ll pay back money you borrowed.
  2. The score generally ranges from 300 (low) to 850 (excellent). It’s calculated by looking at your previous credit history.
  3. You can check your credit report to find the number or use a free credit tool. You can also plug in your best guess.

It’s πŸ’― okay if your credit score isn’t perfect! Wow ⭐ looks like you’re in great financial shape!

It’s πŸ’― okay if you have another mortgage or an imperfect credit score! It’s all good if you have a second mortgage (or not).

You’re almost there. Just a few deets needed.
We’ll have Rocket’s people talk to your people. πŸ˜‰

First-time home buyer?

Fill in all details first to move on.

To find out what you qualify for, hit the button!

You did it!

A home loan expert from Rocket Mortgage® will reach out to you soon.

Nice work!

A refinance expert from Rocket Mortgage® will reach out to you soon.

In the meantime…
Back to the content you came here for! πŸ‘
Feel at Home Make your home feel like home with this handy move-in checklist. βœ…
Feel at Home Settle in with home improvement tips & tricks. πŸ”¨
Feel at Home Settle in with home improvement tips & tricks. πŸ”¨

Between the increased amount of debt that weighs upon many consumers and the declining interest rates on mortgages, many people have considered refinancing their homes to pay off some of that debt.

With growing consumer debts, should consumers refinance their mortgages to pay off debts?

By refinancing, they replace their old mortgage with a new one that has a lower interest rate. This helps to reduce their monthly payments, allowing them to pay more towards other types of debt. A refinance can also be considered as a cash-out option, where consumers borrow against their home’s equity.

Advantages of Refinancing

There are several advantages of doing this. Interest rates on today’s mortgages are much lower than those on credit cards, allowing consumers to pay off their high-interest debts and reduce their overall combined debt interest rate by several points. Another advantage is that the interest paid on mortgages can be deducted from personal tax returns, while the interest on other types of debt cannot.

Downsides of Refinancing

There are, however, downsides to refinancing. If a consumer pays off credit cards using the money received from a cash-out mortgage, they may immediately begin using those credit cards to make new purchases, building up their debt once again. This will quickly leave them with the same amount of debt, but with no equity in their property.

Homeowners are also cautioned not to refinance their homes for large sums of money much greater than what they need. Doing so will put them in more debt overall, and that will be debt that will take much longer to pay off.

You Should Also Check Out…