Smartest way to pay debt refinance, home equity loan or a payment plan??

I have debt totaling 30,000. I own a home in which I have over 150k equity in. I want to pay this debt once and for all. What would be the smartest way to do this? Should I refinance, take a home equity loan or set up a payment plan? My mortgage rate is 5.375 so refinancing would put me into a new higher rate since rates have gone up. I also have access to $10,000 in my 401k that I could borrow. I just want to make the right decision here. Any help would be great! Thanks.

Go to a local bank and take out a fixed rate fully amortized 2nd mortgage. They don't charge any fees for this.

Leave your money in your 401k earning a nice rate of return.

Make extra payments on the 2nd mortgage when possible to pay it off earlier.

Don't use your credit cards after you consolidate!

There's some really good advice here. With that kind of equity in your home, you should really have some give a mortgage analysis for you.

You are certainly on track by looking to consolidate your bills and let your home do the work for you.

Definitely leave the 401k alone. I can show you a couple of different ways where you can keep everything the same, but by restructuring your debt, you can set yourself up for retirment.

Feel free to contact me at casey.x.casperson@chase.com.

Or you can check out my site at caseycasperson.com

Ditech.com. Debt Relief Consultants.

You should be able to get a second mortgage which would probably be lower than any payment plan in which you don't even have to touch your first mortgage and keep that good rate. You definitely have enough equity to do so.

I would leave your 401K alone. You should only tap into that for emergencies. Sounds like a home equity loan might be the best route for you. The interest is tax deductable too. Be careful to not get into debt again. Not sure what you mean by a payment plan. If you can set up a schedule and stick to it that would be an option depending on the interest rate. If the Home Equity rate is less that would be better.

Be careful of those debt services too. They can actually make your credit worse by following their payment schedules. You get out of debt but end up with bad credit.

A home equity line of credit would make the most sense. I just had this same scenario and after much research and my CPA this is what I did. Borrowing on the 401k is a definite no no-don't even go there. Refinancing would commit a large amount or all of your equity along with high closing costs, points, and little flexibility on payback terms and amount borrowed.

Home equity line is being offered from competitive lenders at prime + 0% with no closing costs. You can borrow as little or as much of the total line when you want and pay it back over flexible terms without refinancing large amount at now higher than your current rate. Refi your prob looking at 6.5% ballpark with closing costs and all negatives above vs prime (8%) with much greater flexibility and save the difference by no closing costs.

I just did it myself and happy about my decision. Good luck!