A Refinance Tip You Might Not Know
Did you know that if you refinance your mortgage and get some cash so you can consolidate your high-interest debt, we do not have to count that debt in your debt-to-income ratio (DTI) if it will be paid off at the closing?
Here’s what you need to know.
Refinancing Your Existing Mortgage
Refinancing your existing mortgage and including other high-interest debt, like credit cards or personal loans, is an amazingly effective way to lower your total monthly payments. Many people don’t think they can refinance, though, because they have a lot of debt, so they don’t even bother to try.
When you refinance and take money out of the equity you have in your home, you can do anything you want with that money. If your goal is to reduce your total monthly payments, you can either pay your non-mortgage debts yourself, or have the title company pay off those other debts for you at the closing.
If your non-mortgage debt is so high it prevents you from qualifying for a refinance loan, all you have to do is have the title company pay off those debts for you, and we don’t have to count those debts against you when we get you approved for the loan. There’s no extra charge for that service, and if you have a lot of debts to pay off, it can really save quite a bit of time if the title company does it for you.
If you pay off your debts when you refinance and lower your total monthly payments, but instead of keeping that extra money, you want to use it to pay off your mortgage sooner, we can prepare a report for you that shows you how much sooner your mortgage will be paid off. It will amaze you how much sooner you can pay it off, just by making extra payments each month.
For expert advice on how to get the most out of a refinance, contact us, and see how easy it is to get a mortgage that helps you achieve your financial goals.