A cash-out refinance for debt consolidation lets you leverage your home equity by doing a cash-out refinance to access cash to pay off debt.
When you do a cash-out refinance to consolidate debt with Better Mortgage, you’ll need to specify which debts you’d like to pay off using the cash-out. Once the cash-out refinance is approved, Better Mortgage will provide you with checks to pay off the institutions that hold debts you owe, and your Better Mortgage loan will absorb the debt. In other words, once the cash-out refinance for debt consolidation is done—instead of needing to pay many creditors at varying interest rates—you’ll only need to pay off your new mortgage amount in monthly installments.
Consolidating your debt in this way is popular because the interest rates for mortgages are typically lower than interest rates charged for debts such as credit cards and personal loans.