Debt Consolidation

A cash-out refinance can give you money in your pocket to help make home improvements, consolidate existing debt, buy a new car, pay college tuition or finance other goals. With this kind of refinancing, you will pay off your current mortgage loan and take out a new mortgage at a higher amount. You will need to have adequate equity in your home to make this possible.

Example: The Smiths’ home is appraised at $175,000 and they have $108,000 and 25 years remaining on a 30-year fixed-rate mortgage. They want to get $25,000 cash out of their refinance to pay off their credit card debt and put a downpayment on a new car.

Mortgage amount Rate Term Monthly P&I Payment Cash out Cash out
Current mortgage $108,000 5.25% 25 years remaining on 30-year fixed $673 N/A
Refinance/new mortgage $132,000 4.75% 30-year fixed $689 $25,000