If you have bills that carry a higher interest rate than your existing mortgage, such as credit card debts or car loans, you may want to consider consolidating them into one new mortgage. By refinancing your existing mortgage and high-interest debt into one loan with one monthly payment, you could save hundreds each month.
Example:
| Monthly Debts |
Balance |
Payments |
| Mortgage |
$200,000 |
$1,043 |
| Car #1 |
$20,000 |
$500 |
| Car #2 |
$20,000 |
$500 |
| Visa credit card |
$10,000 |
$300 |
| Mastercard credit card |
$5,000 |
$150 |
| |
|
|
| Totals |
$255,000 |
$2,493 |
After 2% in closing costs, the new loan amount comes to $260,100. With a rate of 4.625%, your new total monthly payment would be $1,337. We've already done the math, that'll save you $1,156 per month!