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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: J. P. who wrote (5607)	9/26/2002 12:59:09 PM
From: GraceZ	Respond to of 306849

In my example which was a specific example taken from a client of mine, the person's term remains exactly the same, 15 years. In other words, they are paying exactly the same payment they paid previous to the refi (minus the credit card payments) and will retire the loan on the same day they would have if they had continued with the higher rate. They haven't increased their indebtedness one cent although you are right in that they have increased the term of the credit card debt (although not by much since they weren't making any headway on the debt as it was). The better solution is to refi the existing mortgage reducing the payments and refi the credit card debt to a fixed term, say five years with a reasonably low rate HE loan. Or to refi as above and pay an additional principle payment equal to what they were paying on the credit cards previously. If you do these things the cash flow to the borrower increases significantly.