Replace 22% credit card rates with 6% mortgage rates. Save hundreds monthly.

You do a cash-out refinance to access your home equity. The cash is used to pay off your high-interest debts (credit cards, auto loans, personal loans, medical bills). You're left with a single mortgage payment at a much lower interest rate. Your total monthly payments typically drop by $500–$1,500.

It depends on your situation. Pros: dramatically lower interest rate (6–7% vs 18–25%), lower monthly payments, potential tax deduction. Cons: you're converting unsecured debt to secured debt (your home), and if you extend the payoff over 30 years, you may pay more total interest. The key is to not rack up new credit card debt after consolidating.

Example: $50K in credit card debt at 22% APR = ~$917/mo in interest. Same $50K at 6.5% in your mortgage = ~$271/mo. Monthly savings: $646. Over 5 years, that's $38,760 in savings — even accounting for the longer mortgage term.

Credit cards, auto loans, personal loans, medical bills, student loans, tax liens, judgments, and other consumer debt. You can also include home improvement costs in the same transaction. The only requirement is sufficient home equity (20%+ for Texas homesteads).

Short-term: the refinance creates a hard inquiry (-5–10 points temporarily). Medium-term: paying off revolving balances dramatically improves your credit utilization ratio, often resulting in a 50–100+ point improvement within 30–60 days of payoff.

If consolidating debt on your Texas homestead, the 50(a)(6) rules apply: 80% max LTV, 12-day cooling period, 1% fee cap. These are constitutional requirements. For investment properties, standard cash-out rules apply without these restrictions.