Certified Mortgage Planning Specialist (CMPS)

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A client with a stable income and a low-interest first mortgage wants to consolidate $50,000 in high-interest credit card debt and fund a small home renovation. They are concerned about rising interest rates and want predictable payments. Which of the following strategies would a CMPS practitioner most likely recommend to best meet the client's goals?

A cash-out refinance to lock in a new fixed rate on the entire mortgage balance. A Home Equity Line of Credit (HELOC) due to its flexibility and lower initial costs. A personal loan, as it doesn't use the home as collateral. The debt avalanche method, paying off the highest-interest debts first without taking on new loans.

Correct Answer:

A cash-out refinance to lock in a new fixed rate on the entire mortgage balance.

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