Debt Consolidation Refinance
What is a debt consolidation refinance? Basically, it’s when you refinance your mortgage loan while also consolidating other forms of debt. In other words, the lender will refinance your mortgage while also paying off other debts (by making them part of the new mortgage payment).
The benefits of a debt consolidation refinance can be twofold. First, a mortgage refinance can help you take advantage of lower interest rates. This can reduce your overall mortgage payment, which is a good thing. Secondly, a debt consolidation refinance can simplify your life by eliminating some of your other debt (basically by rolling those debts into the new mortgage).
So even if the consolidated debt brings your total mortgage payment back up to where it was before refinancing, you will have gained convenience and simplicity. Because now you have eliminated the amount of bills you’ll receive each month.
Of course, you still need to do the math to determine whether the refinance will save you money over the long term. Or more specificially, to make sure it will save you more money than what it costs you to refinance (fees and closing costs). Otherwise, you may be simplicity your life but paying more to do so.
To find out how if refinancing is a good idea for you, read the articles below.
Related articles: Should I Refinance | When NOT to Refinance