Personal debt consolidating mortgage
Your credit score is good enough to get a good interest rate.
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If you are like most Americans, your mail box is filled with offers for credit cards, mortgage refinancing and home equity loans.
Many of those offers stress the benefits of moving existing balances to the new lenders.
Adjustable rate mortgages are also known as “5/1 ARMs” or “7/1 ARMs”.
Generally, 15-year mortgages will have interest rates that are about one-half to one percent lower than will 30-year mortgages, as the quicker repayment period reduces the risk to the bank.
However, as the time period of the loan is compressed, the overall payment will usually be substantially higher.
Overall, these are not a good bet if interest rates are historically low and likely to rise, or if there is a general inflationary environment, meaning higher than four-five percent a year.
Currently, a fixed-rate mortgage at, say, 3.5 percent or 3.75 percent is probably a better bet than an ARM because today’s interest rates are historically low. You can afford a ,000 mortgage to clear your debt and keep a little extra “change” according to the initial scenario.
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