Refinancing and consolidating debt can be one of the smartest financial moves you can make for a number of reasons. Managing cash flow is the single most important aspect in relation to protecting your personal credit. I see many couples with substantial equity in their home fall behind on credit card payments. Refinancing at this point may be impossible due to a bad credit report. Debt consolidation the best solution is no longer an option. Proper cash flow management should include adjusting quickly to any anticipated change in cash flow requirements before your credit is affected and your ability to borrow restricted or possibly eliminated.

Let us assume you have $10,000 in credit card debt at 18%. That is costing you $1800 per year in interest charges. Rolled into your mortgage at our current 3.79% rate that would cost you $379 in interest. With your credit card your minimum monthly payment might be $200. Rolled into your mortgage it would be approx $50. These are approx amounts but you can see the advantages to consolidating your debt by refinancing your mortgage.

The purpose of this article is to tell you to not wait until it is too late and your credit has been affected. Many of us struggle with not enough month at the end of the money. Tapping the tax free equity in your home can be key to smoothing out those fluctuations in cash flow that many of us experience.

Money in the bank can mean peace of mind when unexpected cash flow problems arrive. Remember this old saying “ Never go the the bank on a rainy day for money for an umbrella” . The best way to get money from a lender is to convince them you don’t need money. Refinance your mortgage when times are good and before cash flow problems arise. Take charge of your financial affairs. Don’t let your financial affairs take charge of you. For more information on mortgage financing feel free to contact me.

Larry Matthews