Beginning the Mortgage Process
Debt conslidations with mortgage refinance usually involve increasing the mortgage balance and using the proceeds to pay off higher interest expenses like credit cards and student loans. Mortgage rates are generally lower than consumer interest like car loan rates and credit card rates. This is because mortgage rates are collateralied by the property that you own. Mortgage rates are tax deductible, unlike most other forms of consumer debt. This represents additional savings for the borrower, so it is important to speak with a tax advisor about it.
Competing Offers
It is possible to get competing offers from different mortgage lenders and brokers, which come in the form of “good faith estimates”. These are written estimates of fees and interest rates, and they are not guaranteed.
Debt Consolidation Requirements
After being approved by a mortgage lender, you will receive a terms anc conditions list that your loan officer receives to let you know what additional requirements are made in order to complete the loan. One of the things that is typically listed is the exact debts that need to be paid off. Make sure to carefully evaluate this list so that you are paying only what you are actually meant to pay. Many lenders will require some, or all consumer debts to be paid off. Make sure you are clear on which debts will and will not be paid off with the mortgage.
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