Overcoming Debt by Cashing Out and Debt Consolidation
Are you overwhelmed with debt? Most situations with high credit card balances, student loans, large mortgage payments, auto payments, and other debt obligations can be overcome by cashing out on your home if you have equity. Your annual percentage rate (APR) on your home loan versus your credit card or other debt obligations are usually a lot lower.
You can save a lot of money by paying off your credit cards or paying off debt obligations with the equity in your home. Depending on the situation you can cash out FHA, Conventional, USDA, and VA when paying off credit cards with the equity of your home.
Why Cash Out or a Debt Consolidation Loan?
A cash out or debt consolidation loan is a solution to borrowers who are overwhelmed with high monthly payments. When comparing debt consolidation payments versus building them into your mortgage is tremendous monthly savings. Credit cards can have 20 plus percent interest rate and car loans have short term financing with a higher rate than a mortgage.
Conventional Cash Out and Debt Consolidation
- Up to 80% loan-to-value for primary residence
- Up to 75% loan-to-value for investment
FHA Cash Out and Debt Consolidation
- Up to 85% loan-to-value with no pricing adjustments on the interest rates.
- Conventional loans have pricing adjustments when refinance with a cash out refinance and the interest rate is usually higher than a rate and term refinance.
VA Cash Out and Debt Consolidation
- With a VA cash out, the maximum loan-to-value is 100%.
Benefits for Cash Out and Debt Consolidation
- Defer up to 2 mortgage payments.
- Overall lower monthly debt payments.
- FHA – Possible Refund on Initial FHA Insurance Premium and lower monthly insurance.
- One low monthly payment with no high balances with many different accounts
- Refund on your current escrow balance
Home values have skyrocketed. Use this advantage to eliminate mortgage insurance forever and knock out stressful bills with extra cash.