Refinancing Your Debt

If you have a fair amount of unsecured debt you may want to consider refinancing and consolidating your debt into your mortgage. By carrying a lot of debt you erode your cash flow by making several payments per month. You might find it difficult to make a dent in the principle balance of those debts. By consolidating this debt into your mortgage you can put a strategy in place that not only save you interest on high interest debt, but for the same out put per month you may be able to shave years off of your mortgage as well.

For Example:

Let's assume your current mortgage payment is $1550 per month, you also have the following debts:

Car loan                        Owe      $   8,900           Payment           $ 479/month

Visa                              Owe      $ 11,500            Payment           $ 345/month

Line of Credit                 Owe      $   6,500           Payment           $ 195/month

Cash output                                                       Payment           $2,569/month

Original amortization on your mortgage = 24 years

Interest paid      $196,079.07

Restructured debt amortization = 17.42 years

Interest paid      $132,449.74

Saved interest    $  63,629.33

The great part, is that you are now mortgage free 6.58 years faster, meaning that you will not have to make 78.96 payments that you would have otherwise had to make this means you will have an extra $122,388 in your pocket to invest elsewhere.

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