#refinancing

Secondly, I have a question about balance transfer credit cards. I'm in a place where I'm paying off my highest card consistently, but the interest is still killing me. Not only that, but my balance is around 60% of my limit, which is hurting my credit score. I understand that most transfer cards charge 3-5% per transfer, but if I could pay the transfer off in the given ~18 months of 0% APR (which I believe I could), it could help me significantly, even given the 3-5% hit.

Although you've instilled a lot of confidence in me, I'm not confident enough in this decision to pull the trigger without further advice. I'm always leery of opening a new card. I would greatly appreciate any wisdom you have to offer!

Thank you so much for all you do!

Hi honey! Thank you for your kind words.

And if you don't have the confidence to pull the trigger without checking in... you have our permission to do a balance transfer. The temporary 0% APR of a balance transfer credit card can give you a huge headstart on paying back the principle without drowning in interest like you are now. Even with a 3-5% transfer fee, the math will likely work out in your favor.

Here's more info on how consolidations, refinancing, and balance transfers work:

When (And How) To Try Refinancing or Consolidating Student Loans 

The weather turned frightful for large loans that missed the extended window of 3 - 4.6%. Although it’s always best to see the lowest possible interest when borrowing, sometimes time is the boss. It isn’t always prudent to refinance early - especially if you’re holding a loan with a prepay penalty. Making the best of a rate challenge involves looking at the long-range forecast and planning the types of deductions that create the most growth over the course of the length of your loan. Whether you’re getting a new loan or you're refinancing an existing loan, avoiding a prepay penalty may be your best move.

Are you planning to refinance to switch to more competitive rates or reduce your debts? Here are some dos and don’ts so you won’t fall on some pitfalls when it comes to refinancing.

DOS

1. Speak to an expert before refinancing

Sure, money talks can be uncomfortable. Being honest to another person about your current financial situation doesn’t sound fun either. But trust us, speaking to an expert broker before refinancing can actually save you from lots of hassle in the future. They’re able to connect you with a lender that can offer more competitive rates, helping you save time and paperwork. Just be transparent to them about your goals and situation so they can look for the best solution for you.

2. Consider shorter term loans

One of the benefits of refinancing is you can choose a shorter term loan. For instance, you may choose a 10-year plan if you still have 15 years left on your 20-year mortgage. So if you have a chance and if your current situation allows, refinance to shorter term loans. This will help you save on interests plus, you can achieve a debt-free status earlier.

Interest rates had been falling for most of the past three decades – but two years ago, they started climbing. The yield on the 10-year Treasury note recently climbed above 3%, up from less 1.5% just a couple of years ago.

Among the reasons that rising rates matter is that they have numerous effects on the housing market. Some of these effects are obvious. As interest rates climb, so will mortgage rates, making houses relatively less affordable. Refinancing also becomes less attractive.