Want to Refinance & Combine 5-Year ARM & HELOC

[Administrator]

I currently have a 5-Year ARM which is set to increase in 8/09. My current interest rate on my ARM is 5.5%, and I have an outstanding balance of $163,565.68.I also have a HELOC with an outstanding balance of $20,496.26 and a credit limit of $32,550. Currently, the HELOC has an interest rate of 6.0%...but obviously fluctuates with interest rate changes.So, my question is…I want to pull out $100,000 of equity in my house, which is currently valued at $300,000. Obviously, I would like to do this in a manner that will give me the lowest long-term interest rate, and thus the lowest monthly payments. It would seem best to combine my 5-Year ARM, HELOC and equity payout into one 30-Year Fixed Mortgage…but that would be at an interest rate higher than my current 5.5%. But then my 5-Year ARM would go up in a year anyway, so maybe it’s better to act now before interest rates get higher? Or maybe I just add to my HELOC?What to do?


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(Source: mortgagefit.com)