Are you in an extreme amount of debt and wondering what is the best way to go about organizing your payments and paying off high-interest loans? Don’t worry because you are not alone. Many Americans are in debt of all kinds, such as student loans, mortgage debt, car loans, and credit card debt. So, a useful solution to help pay off this amount and consolidate it into one payment would be to refinance your existing mortgage.
To help provide some insight, your local Orlando mortgage lender, The Harper Mortgage Team, will explain what a mortgage refinance is and how to consolidate your debt through refinancing.
What Is Mortgage Refinance?
Refinancing your mortgage means you are replacing your existing mortgage with a completely different one. Your new Orlando mortgage will have the same balance as your existing mortgage but it will most likely have better interest rates.
Benefits of Refinancing
You can refinance your mortgage for a number of different reasons. If your first mortgage was issued during a time when interest rates were incredibly high, you could refinance your loan to obtain a new, lower-interest rate. This alone can help save you hundreds of dollars every month on your payments.
Another benefit of refinancing is that you can change your amortization period. This means you can shorten or extend the time your loan should be paid for in full. So, if you are wanting to make larger payments and pay off your loan sooner, you could refinance to have an earlier amortization period, such as switching from a 30-year mortgage to a 15-year mortgage or vice versa.
You can also refinance your loan if you wish to consolidate your debt.
Consolidating Your Debt
Consolidating your debt with a mortgage refinance is an excellent option if you are struggling with your monthly payments. Through refinancing, you could pay off any high-interest debt you may have to help increase your credit score and lower your monthly payments, or you could consolidate your debt into one payment.
Refinancing your Orlando mortgage so you only have to worry about making one payment per month can help you get more organized and not have to stress about potentially missing a payment.
Also, if you have a lot of credit card debt, refinancing your mortgage means you will receive the current low mortgage rates, which is significantly lower than the interest rates of credit cards.
For more information on how to consolidate your debt with a mortgage refinance, please contact your local Orlando mortgage lender, The Harper Mortgage Team, at 407-614-3095.