Consider this:
1. I have $ 30k in credit card debt.
2. I have a 1st mortgage for $ 200k (4%) and a Home Equity line of $ 170k (at prime rate) with no additional credit available.
3. I am buying another house at the end of April.
Would I be better off refinancing my Home Equity and Credit Cards into a new Home Equity loan, or just stick with it as is?
I have heard that I may be able to get better rates on my loan for my new house if I refinance. Could this be true?
Thoughts? Opinions? Alternatives?
Best answer:
Answer by HonestAnswers
Buying another home with a HELOC of $ 170K is a bit risky. If you are doing this for investment purposes, be sure you can cover your new mortgage / taxes / monthly maintenance. That said, consolidating your credit card debt is a good idea ONLY if you are willing to cut up all of your credit cards and never use them again. Learn to pay cash before you leverage yourself with debt through owning 2 homes, a HELOC, and credit cards.
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