When homeowners hear that mortgage rates are higher than a few years ago, it is easy to assume refinancing is off the table. But focusing only on your mortgage rate could cause you to miss a bigger opportunity to save.

Today, many homeowners are carrying more than just a mortgage. Car loans, credit card balances, student loans, and other debts can quietly add up. When you combine everything you owe, your blended rate, the real average interest rate across all your debts, might be much higher than you think.

In some cases, refinancing and consolidating high-interest debt into a mortgage could lower your overall cost of borrowing*, even if your new mortgage rate is higher than the one you originally had.

What Is a Blended Rate?

Your blended rate is the weighted average of all the interest rates you are paying across different debts.

It gives a better view of your true borrowing cost, not just what you are paying on your mortgage.

For example, while your mortgage might be locked at 3.5%, you might also have:

• Credit card balances with rates averaging about 20.09% (source)
• An auto loan with a nonprime rate around 9.59% for new cars and 11.62% for used cars (source)
• Private student loans with rates that can range between 7% and 17% depending on your credit profile (source)

When you blend those high-interest debts into the picture, the overall cost of your debt may be far higher than your mortgage rate suggests.

That means refinancing could help improve your personal situation, not just adjust your home loan.

Why It Matters More Than You Might Think

Most people think about debt separately. Your mortgage here, credit cards there, auto loan somewhere else. Does your household finance multiple cars? Do you have a partner with student loan debt as well? Your blended rate becomes even more important to understand.

But your wallet feels the total monthly payment across all those debts, not just one. If refinancing allows you to combine higher-interest debts into a single, lower-interest mortgage, it could:

• Save you money in total interest paid over time
• Simplify your monthly budgeting with one payment
• Free up cash flow* to focus on savings or other personal goals

In today’s market, refinancing is less about chasing the lowest mortgage rate and more about understanding how your mortgage fits into your overall situation.

Is Refinancing Always the Right Move?

Not always. You still need to consider factors like closing costs, how long you plan to stay in the home, and whether consolidating debt into your mortgage fits your long-term goals.

But for homeowners carrying significant non-mortgage debt, running the numbers can reveal options that headlines about “higher rates” might make you overlook.

How to Find Out If Refinancing Makes Sense

If you are curious whether your blended rate could be pulling you down, start by gathering your current debts, balances, and interest rates.

Movement can help you calculate your blended borrowing cost and compare it to what a refinance could offer. It might turn out that refinancing is not just possible, it could be a smart way to accomplish your future goals.

*Qualification is required. By refinancing your existing loan, your total finance charges may be higher over the life of the loan. Terms and conditions are subject to change without notice.