Ask our mortgage assistant

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• FHA & Conventional

  How do I refinance from an FHA loan to a conventional loan, and is it worth it?

  You refinance into a new conventional loan that pays off the FHA loan. It's usually worth it when you have about 20% equity, because conventional loans don't need mortgage insurance at that point, and your credit has improved. The math has to beat the closing costs, especially if your current rate is low. The Mortgage Advisory is the direct lender on conventional loans in California, Texas, and Colorado and runs the break-even for you.

• Debt Consolidation

  I'm a homeowner with credit card debt. What are my options to pay it off?

  As a homeowner, you have more options than most people: balance transfer cards, a personal loan, a debt management plan, and your home equity through a HELOC, home equity loan, cash-out refinance, or, if you're 62 or older, a reverse mortgage. At The Mortgage Advisory, we steer people toward the option that lowers their Life Rate, the blended rate on everything they owe, and their total cost.

• Refinancing

  What is a no-closing-cost refinance, and is it really free?

  No. In a no-closing-cost refinance, the lender covers your costs in exchange for a slightly higher interest rate, or the costs get added to your loan balance. It can be a smart move if you might sell or refinance again within a few years. The Mortgage Advisory shows you the no-cost and standard options side by side so you can see which one costs less over your time in the home.

• HELOC & Equity

  HELOC or cash-out refinance: which is better?

  It depends on how much debt you're carrying and the interest tied to it, not just your mortgage rate. If your other debts are small, a HELOC usually wins because it leaves your low first mortgage alone. If you're carrying a lot of high-interest debt (credit cards, car loans, solar or PACE liens), a cash-out refinance can lower your Life Rate, the blended rate on everything you owe, even if your mortgage rate goes up. The Mortgage Advisory calculates your Life Rate both ways before you decide.

• Refinancing

  When is refinancing worth it, and how much lower does my rate need to be?

  There's no magic rate drop. A refinance is worth it when the monthly savings pay back your closing costs well before you'd sell or refinance again, usually within two to three years. At The Mortgage Advisory, we give you the break-even month in writing and tell you to wait if the math doesn't work.