Question

I have a question y’all! Tell me what y’all thoughts are and/or what would you do? I have 80k in debt. I was thinking of refinancing my home to take out the equity to pay that off and just now have that one payment. Between all the debt i have totals monthly payments of $2000. So i was thinking if i Refi and my monthly mortgage payment goes up 600-800 wont it be worth it to do so? I mean i’d be savings money, and that money im saving i can turn around and put it back to the mortgage to pay it off earlier than expected. Thanks in advance guys

Answer 1

Moving debt around doesn't change the habits that put you into debt. You could end up right back where you are plus a bigger mortgage if your habits aren't changed. Also if something tragic were to happen and you can't make your payments you lose your house instead of just default on your CCs/car/etc.  

Answer 2

You should never tie debt to your house. If you were unable to pay, ? you could lose your house.  

Answer 3

We did it and ended up racking it back up unfortunately. Just a warning but I hope it goes well if you do it!  

Answer 4

Thank you ladies! You are so right! I didnt think about that point! If something happens i rather have bad credit then be homeless . definitely a good point to think about that i overlooked

Answer 5

We are refinancing because rates are low. We’ll save one percent in interest and in doing so get rid of pmi. We are not taking out any equity. Dropping the interest rate and pmi will lower our house payment by $200 a month. We will then use the $200 a month to apply to other debts.  

Comments

@oliy6 Thats awesome!  

Answer 6

I’ve always heard you should not turn unsecured debt into secured debt, but that’s a huge savings per month that would allow you to pay your house down faster and have no other debt. I’d be torn.  

Comments

I guess I’d have to think about how hard it would be to pay the new mortgage payment if I lost my job? Are you in a high demand field like nursing that it would most likely be easy to find another job? Could you pick up a part time job easily to cover it if you absolutely had to?  

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@alpert71 i’m in the real estate industry. so yea id probably not a good idea