Credit card debt doesn't only hurt your budget, it can weaken your long-term financial health. The average U.S. household holds several thousand dollars in credit card debt, often costing hundreds or thousands in interest each year.
Studies show utilization often improves after high-interest debt is paid off.
When you pay off that debt with a cash-out refinance, you:
Studies show cash-out borrowers often see early improvements in credit utilization, a key credit score factor, after using refinance funds to eliminate high-interest debt.
This kind of strategic refinancing isn't only about debt. It's about building forward motion.
Paid-off cards give you room in the monthly budget, and keeping those balances at zero is what turns that room into progress.
Nearly 30% of homeowners are considering tapping home equity in the next year, showing interest remains high even in a shifting rate environment.
When tapping home equity, many homeowners consider a cash-out refinance and a HELOC (Home Equity Line of Credit) as two leading options, but they serve different purposes.
In reality, strategic refinance borrowers most often use funds for targeted goals, like debt reduction, home improvements, and financial planning. And with homeowner equity near historic highs, many borrowers have significant value left after refinancing.
A loan officer can compare what you pay on your cards today with a cash-out refinance payment, so you see the monthly difference before anything is offered. Pre-qualifying will not affect your credit score.
Pre-qualify