High interest debt on credit cards, auto loans, or other consumer loans can be difficult to pay off and may create a barrier to your financial goals.
However, if you're a homeowner, you have additional options to help you manage your debt, including a debt consolidation mortgage and home equity loan or line of credit.
A way to gauge the numbers is to do a break-even analysis.
For example, a 30-year fixed-rate mortgage with an interest rate of 9% on a $100,000 home has a principal and interest payment of $804.62.
That same loan at 6% reduces your payment to $599.55.
Today, many lenders say 1% savings is enough of an incentive to refinance.
Reducing your interest rate not only helps you save money, it also increases the rate at which you build equity in your home, and it can decrease the size of your monthly payment.
As a homeowner, one way to start managing some of your higher-interest debt is to refinance your existing mortgage with a debt consolidation mortgage.