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Should we consolidate our first and second mortgages into one loan?

Q: We have a first mortgage at 5.75% and a second mortgage at 8.75%. Should we refinance and combine the two?

A: If you have an equity position which allows you to consolidate both loans into a new first mortgage -- that is, after the refinancing, your loans don't exceed about 80% of the present value of the home -- and you plan on remaining there for at least several years, you should be able to realize some considerably interest savings with a single new mortgage. Use our mortgage calculator to see where you are in both mortgages, then calculate your interest costs after a consoldiating refinance.

More help from HSH.com

  • When refinancing at a higher rate makes sense

    Trade your old mortgage for a new, higher-rate version? There are times when it actually makes sense.
  • Should I pay off a mortgage early?

    By making extra principal payments or refinancing your mortgage, you could pay a lot less interest and free yourself from your mortgage ahead of schedule. Here are the pros and cons of retiring your mortgage early.
  • How does a refinance in 2017 affect your taxes?

    After a mortgage refinance, there are some specific "dos" and "don'ts" you need to know prior to filing your income taxes, as well as a few pointers that can help you lower your tax bite.

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