Good refinance plan?

refinance planI’m currently in the position of possibly refinancing my home, and tacking in some credit card debt as well.

While the offer being give sounds all good, I’m not by any means “money-literate”.

So, maybe I’m missing something here. Here’s my situation at the moment.

I have a first mortgage, traditional 30-year fixed, at 6%. I have a second mortgage, interest-only, adjustable rate, currently at 9.5%. Been at 9.5% for the last 3 months.

I also have a credit card debt of $37,965 spread out amongst 4 credit cards. I am exactly 3 years into my current mortgage.

1st mortgage (6%)
$320,234.00 balance

2nd mortgage (9.5%)
$320/month interest only
$39,623.00 balance

Amex CC (9.9%)
$217/current minimum payment
$10,930.00 balance

Chase CC (9.9%)
$118/current minimum payment
$5,690.00 balance

Chase CC (3.99%)
$191/current minimum payment
$9,373.00 balance

Citibank CC (3.99%)
$181/current minimum payment
$11,972.00 balance

With these above, I am currently paying “at least” $3,027 a month, just to keep all my payments in check. Realistically, I only pay the minimums on the credit cards, but I actually pay $1,000 towards the second mortgage instead of just $320, so that I have principal covered as well. So, in reality, actual funds I am paying monthly is $3,707/month.

On a refinance, I was offered 5.8%, for my 1st, 2nd, and CC debt. Fees to be included into the payments, of course. This is the offer I received.

1st mortgage, 2nd mortgage, and all credit card debt, consolidated into the refinance.

$2,466/month, would cover all the above. 30-year fixed. 5.8%. Fees already included into the monthly.

So, I’m currently paying $3,707/month, which covers my 1st and 2nd, and the minimum only on the credit cards. If I do the refinance, it would be $2,466/month, and would also cover the 1st and 2nd, as well as all the credit cards, and in return would leave me with $1,241/month additional cash funds, for reinvesting or otherwise.

The numbers all sound good. Already approved for the above. But, I am mostly questioning if its a good idea to drop the two credit cards in there that are currently at 3.99% each. Would it be better if I just went ahead and consolidated all EXCEPT the one Chase and one Citibank card? Then, with the monthly savings, I could pay off those lower-interest cards much more quicker myself, as opposed to throwing them into the 30-year plan and stretching them out. At the same time, I can keep my new monthly mortgage at a lower rate.

Any suggestions and opinions are greatly appreciated.

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