How Should I Refinance?

[Benjamin Black]

Hey guys, not sure if this is the right kind of forum to ask this question, but here goes. In 2015 we went through a personal tragedy and we were forced to use credit cards to deal with it. It's three years later and we still owe around $30,000 in credit card debt. I overpay each month and the credit cards cost me around $1100/month. This $1100 is KILLING me each month. I can't establish a savings, it's just crushing me.

So I want to take equity out of my house to pay off the credit cards. I owe $104,000 on my house but it's values at $175000. So I'm thinking about doing a cash out refinance to get the $30,000 and pay off the credit cards. Saving $1100/month will change my life. PS - my credit score is 730 and my current interest rate on my home is 5.25%

Looking for tips, I'm not sure what kind of loan is best, home equity, cash out, Thanks SO SO much!

[Michael Pearse]

@Benjamin Black In this situation I recommend getting a home equity line of credit. The interest rate on a HELOC will be:

1. Significantly lower than a credit card

2. A HELOC won't disrupt the current amortization process

3. Will be cheaper due to not having to go through the entire refinance process, documents, contracts, ect. 

Best of luck!