Consolidate your debt

Consolidate your debt. Save on interest.
Get cash out.

If you want to get out from under high interest rate charges from credit cards, student loans, or other forms of debt, then a cash-out refinance might be the solution for you. Consolidating your debt by refinancing allows you to put existing debt into your mortgage—typically at much lower interest rates. The result is a single interest rate and single monthly payment. Generally, you’ll end up paying less each month than you do now, paying all the bills separately.

How much can you increase cash flow by consolidating debt? An example.

Although every debt consolidation refinance is different, here’s an example to give you an idea of how much you can save.

Tom and Nancy bought their first home for $753,000 using a first and second mortgage. To make room for their growing family, the couple plans to move to a larger home within the next five years. To maximize their selling price when the time comes, Tom and Nancy invested $55,000 in renovations – which they paid for with their credit cards. Although enjoying the earned frequent flier miles, they have now maxed out their credit cards.
The couple, whose home was valued at $1.1 million in the current market, turned to Guarantee Mortgage to see if they could consolidate the debt, eliminate credit card balances, and open up monthly cash flow. Their Loan Advisor, after shopping around, presented a 5/1 adjustable rate mortgage (ARM) loan fitting the circumstances.
Monthly Payments Current After Refinancing
(10 year, interest-only 6.25%)* (5/1 adjustable rate, 3.25%)*
First mortgage: $676,000 $3,521 $2,794
Second mortgage: $77,000
(30 year, fixed, 7.05%)*
$556 $0
Credit card debt: $55,000 $ 989 $0
(for the combined debt of $808,000)
$5,066 $3,516
Monthly Savings $1550. Credit card debt after the refinance? None.*NOTE: Rates reflected here are for illustration purposes only. Rate and points are subject to change without notice.

Did they take the loan? You bet! Tom and Nancy knew they’d be moving within the next five years, so they were comfortable with both the five-year, fixed-rate period as well as the terms of the adjustable rate cap should it take a bit longer to sell the home.

What mattered was eliminating the credit card debit and maximizing monthly cash flow. The refinance allowed them to accomplish both goals.

How much can you save by consolidating debt?

Try our debt consolidation calculator, which will tell you how much your monthly payment might decrease, how much you’ll save in interest, and how long it will take you to pay off the newly consolidated loan.

Call us at 866-612-5050, or email us to arrange a free consultation today. An experienced Guarantee Loan Advisor will talk to you about consolidating your debt, and tell you what your new monthly payment might look like based on going rates.

We’ll do the work—you’ll save the money!

American Pacific Mortgage does not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. A debt consolidation may increase your monthly cash flow, but may increase the amount of your debt over a period of time by including the additional debt in your mortgage amount, which is financed over a longer period of time than the debt consolidated may have been financed. We encourage all consumers to do their own research, and examine their options carefully before selecting a particular course of action.

*For more information please visit our Disclosures page: