Refinance Your Mortgage to Free Up Cash
Replace High-Interest Credit Card Debt
Use a Cash-Out Mortgage Refinance to Reduce Rates
Not only is cash-out refinancing a great way to reduce the interest rate on your mortgage, but it is also the best use of refinancing as a debt consolidation solution. When you refinance your home using the cash-out method, you replace your existing mortgage with a new loan that has a higher total amount, effectively paying off the first loan and positioning the larger one in its place. In doing this, you gain access to the equity that you have built up in your home, allowing it to be removed and turned into a cash sum.
Once you have taken the equity out of your home in the form of cash, you can use it however you like. One of the most common and most productive uses of these newly acquired funds is to pay down outstanding debt, particularly if it has a high interest rate. Since the cash taken from your new mortgage loan is likely to have a much lower interest rate than a credit card or student loan, using it to pay down your debt balance will save you money in the long run. In other words, the interest that you pay on the money from your mortgage will cost potentially half as much as the high interest you would pay on your outstanding debt.
Lowering your interest rate using a cash-out refinance may also help you save more money overall. See for yourself by using our savings calculator to get an estimate of how much extra cash you can save by refinancing your home mortgage.
Get a Free Refinance Quote
If you are struggling to pay off high-interest debt while bills pile up, consider a cash-out refinance for debt consolidation through J.G. Wentworth. As a direct lender of home mortgages, we have the experience and know-how to help you find the refinancing options that benefit you most, whether you’re looking to take cash out of your home or lower your monthly payment. For any additional mortgage FAQs or to get your free, no-obligation quote, call one of our loan specialists or fill out our convenient online form today.