{
  "schema_version": 1,
  "dataset_id": "debt-consolidation-worked-examples-2026",
  "title": "2026 Debt Consolidation Refinance Worked Examples",
  "description": "Three hypothetical, source-mapped examples showing payment, borrowing-cost, debt-to-income, and loan-structure tradeoffs for debt consolidation decisions.",
  "version": "2026.1",
  "published_date": "2026-09-03",
  "source_reviewed_date": "2026-09-03",
  "example_count": 3,
  "record_count": 3,
  "scope": "Educational fixed-rate examples for comparing modeled debt consolidation structures. The examples do not model taxes, insurance, mortgage insurance, changing credit-card minimums, adjustable rates, future borrowing, or every cost and eligibility rule that may apply.",
  "disclaimer": "All three examples are hypothetical and use no actual borrower data. They are not an approval, commitment to lend, rate quote, legal or tax advice, or a guarantee of payment relief, savings, eligibility, or debt exclusion. A lower monthly payment is not the same as lower total cost. Extending debt over a longer mortgage term can increase total interest and fees. Replacing unsecured debt with debt secured by a home can create foreclosure risk if the home-secured loan is not repaid. Actual results depend on verified debts, income, property value, loan terms, closing costs, program rules, lender requirements, and the complete borrower profile.",
  "methodology": "Kellibrooke models fixed-rate principal-and-interest payments with monthly amortization loops using unrounded balances and payments, rounds only published results, compares five-year borrowing cost as interest plus stated loan costs, and maps each hypothetical fixture to reviewed primary sources. The high-DTI example is conditional on the stated debts being eligible for exclusion under the applicable program and lender analysis.",
  "landing_page_url": "https://kellibrooke.com/programs/debt-consolidation/",
  "correction_policy_url": "https://kellibrooke.com/editorial-standards/",
  "license": {
    "name": "Creative Commons Attribution 4.0 International",
    "url": "https://creativecommons.org/licenses/by/4.0/",
    "applies_to": "Kellibrooke's original compilation and original explanatory wording only. Linked source material and underlying rules are excluded and retain their own terms."
  },
  "fields": {
    "assumptions_json": "Machine-readable hypothetical inputs for the fixture",
    "results_json": "Generator-verified results calculated from the fixture inputs",
    "interpretation": "Bounded explanation of what the calculated comparison shows",
    "guardrail": "Limits that must remain attached to the hypothetical result",
    "source_ids": "Primary-source identifiers mapped to the fixture"
  },
  "sources": [
    {
      "id": "cfpb-debt-consolidation",
      "publisher": "Consumer Financial Protection Bureau",
      "title": "What do I need to know about consolidating my credit card debt?",
      "source_version": "2026-09-02",
      "reviewed": "2026-09-03",
      "url": "https://www.consumerfinance.gov/ask-cfpb/what-do-i-need-to-know-if-im-thinking-about-consolidating-my-credit-card-debt-en-1861/"
    },
    {
      "id": "cfpb-loan-estimate-comparison",
      "publisher": "Consumer Financial Protection Bureau",
      "title": "Compare and negotiate your loan offers",
      "source_version": "2024-12-12",
      "reviewed": "2026-09-03",
      "url": "https://www.consumerfinance.gov/owning-a-home/compare/compare-loan-estimates/"
    },
    {
      "id": "texas-constitution-article-xvi",
      "publisher": "Texas Legislature",
      "title": "Texas Constitution, Article XVI",
      "source_version": "accessed-2026-09-03",
      "reviewed": "2026-09-03",
      "url": "https://statutes.capitol.texas.gov/Docs/CN/pdf/CN.16.pdf"
    },
    {
      "id": "fannie-b3-6-02-dti",
      "publisher": "Fannie Mae",
      "title": "B3-6-02, Debt-to-Income Ratios",
      "source_version": "2025-04-02",
      "reviewed": "2026-09-03",
      "url": "https://selling-guide.fanniemae.com/sel/b3-6-02/debt-income-ratios"
    },
    {
      "id": "fannie-b3-6-07-debts-paid",
      "publisher": "Fannie Mae",
      "title": "B3-6-07, Debts Paid Off At or Prior to Closing",
      "source_version": "2023-04-05",
      "reviewed": "2026-09-03",
      "url": "https://selling-guide.fanniemae.com/sel/b3-6-07/debts-paid-or-prior-closing"
    }
  ],
  "examples": [
    {
      "id": "payment-relief-versus-lifetime-cost",
      "title": "Payment relief versus scheduled lifetime cost",
      "example_type": "whole-loan-cost-comparison",
      "hypothetical": true,
      "source_ids": [
        "cfpb-debt-consolidation",
        "cfpb-loan-estimate-comparison",
        "texas-constitution-article-xvi"
      ],
      "assumptions": {
        "home_value_usd": 600000,
        "current_mortgage": {
          "principal_usd": 300000,
          "annual_note_rate_percent": 7.5,
          "remaining_term_months": 300
        },
        "fixed_debt": {
          "principal_usd": 60000,
          "annual_note_rate_percent": 18,
          "remaining_term_months": 60
        },
        "proposed_mortgage": {
          "principal_usd": 360000,
          "annual_note_rate_percent": 6.5,
          "term_months": 360
        },
        "loan_costs_paid_in_cash_usd": 8000,
        "mortgage_insurance_usd": 0
      },
      "results": {
        "current_mortgage_pi_usd": 2216.97,
        "fixed_debt_payment_usd": 1523.61,
        "current_total_monthly_payment_usd": 3740.58,
        "proposed_mortgage_pi_usd": 2275.44,
        "monthly_payment_relief_usd": 1465.13,
        "proposed_ltv_percent": 60,
        "baseline_five_year_borrowing_cost_usd": 139632.4,
        "proposed_five_year_borrowing_cost_including_cash_costs_usd": 121526.21,
        "proposed_five_year_cost_lower_by_usd": 18106.19,
        "baseline_scheduled_lifetime_interest_usd": 396508.4,
        "proposed_scheduled_lifetime_interest_usd": 459160.16,
        "proposed_scheduled_lifetime_cost_including_fees_usd": 467160.16,
        "proposed_scheduled_lifetime_cost_higher_by_usd": 70651.76
      },
      "interpretation": "The modeled refinance lowers the first-month combined payment and the five-year borrowing cost, but it has a higher scheduled lifetime cost if paid only as scheduled.",
      "guardrail": "This is not a savings promise. It assumes fixed rates and fixed payments, excludes taxes and insurance, and does not establish Texas constitutional or loan-program eligibility."
    },
    {
      "id": "high-dti-conditional-debt-exclusion",
      "title": "High-DTI example with conditional debt exclusion",
      "example_type": "debt-to-income-comparison",
      "hypothetical": true,
      "source_ids": [
        "fannie-b3-6-02-dti",
        "fannie-b3-6-07-debts-paid"
      ],
      "assumptions": {
        "qualifying_gross_monthly_income_usd": 12000,
        "complete_current_housing_expense_usd": 3000,
        "other_monthly_debt_payments_usd": 3120,
        "complete_proposed_housing_expense_usd": 4020,
        "modeled_other_debt_payments_after_closing_usd": 0,
        "debt_exclusion_is_conditional": true
      },
      "results": {
        "current_total_monthly_obligations_usd": 6120,
        "current_dti_percent": 51,
        "proposed_total_monthly_obligations_usd": 4020,
        "proposed_dti_percent": 33.5,
        "modeled_dti_reduction_percentage_points": 17.5
      },
      "interpretation": "The modeled DTI changes from 51.00% to 33.50% only if the complete proposed housing expense is accurate and the paid debts are permitted to be excluded.",
      "guardrail": "Paying debt at or before closing does not guarantee exclusion from DTI. Treatment depends on the program, debt type, documentation, funding source, underwriting findings, lender requirements, credit history, and complete borrower profile."
    },
    {
      "id": "low-rate-first-mortgage-structure",
      "title": "Low-rate first mortgage structure comparison",
      "example_type": "first-mortgage-versus-full-refinance",
      "hypothetical": true,
      "source_ids": [
        "cfpb-debt-consolidation",
        "cfpb-loan-estimate-comparison",
        "texas-constitution-article-xvi"
      ],
      "assumptions": {
        "current_first_mortgage": {
          "principal_usd": 400000,
          "annual_note_rate_percent": 3.25,
          "remaining_term_months": 288
        },
        "modeled_second_lien": {
          "principal_usd": 90000,
          "annual_note_rate_percent": 8.5,
          "term_months": 180
        },
        "modeled_full_refinance": {
          "principal_usd": 490000,
          "annual_note_rate_percent": 6.5,
          "term_months": 360
        },
        "loan_costs_included_usd": 0
      },
      "results": {
        "current_first_mortgage_pi_usd": 2002.06,
        "modeled_second_lien_pi_usd": 886.27,
        "combined_first_and_second_pi_usd": 2888.32,
        "modeled_full_refinance_pi_usd": 3097.13,
        "full_refinance_monthly_pi_higher_by_usd": 208.81
      },
      "interpretation": "Before costs, the modeled first-mortgage-plus-second-lien structure has a lower combined monthly principal-and-interest payment than refinancing the full balance at the stated rate and term.",
      "guardrail": "This is not a recommendation or quote. The example excludes closing costs, taxes, insurance, mortgage insurance, lien terms, and eligibility analysis, all of which can change the decision."
    }
  ],
  "rows": [
    {
      "example_id": "payment-relief-versus-lifetime-cost",
      "example_title": "Payment relief versus scheduled lifetime cost",
      "example_type": "whole-loan-cost-comparison",
      "hypothetical": true,
      "assumptions_json": "{\"home_value_usd\":600000,\"current_mortgage\":{\"principal_usd\":300000,\"annual_note_rate_percent\":7.5,\"remaining_term_months\":300},\"fixed_debt\":{\"principal_usd\":60000,\"annual_note_rate_percent\":18,\"remaining_term_months\":60},\"proposed_mortgage\":{\"principal_usd\":360000,\"annual_note_rate_percent\":6.5,\"term_months\":360},\"loan_costs_paid_in_cash_usd\":8000,\"mortgage_insurance_usd\":0}",
      "results_json": "{\"current_mortgage_pi_usd\":2216.97,\"fixed_debt_payment_usd\":1523.61,\"current_total_monthly_payment_usd\":3740.58,\"proposed_mortgage_pi_usd\":2275.44,\"monthly_payment_relief_usd\":1465.13,\"proposed_ltv_percent\":60,\"baseline_five_year_borrowing_cost_usd\":139632.4,\"proposed_five_year_borrowing_cost_including_cash_costs_usd\":121526.21,\"proposed_five_year_cost_lower_by_usd\":18106.19,\"baseline_scheduled_lifetime_interest_usd\":396508.4,\"proposed_scheduled_lifetime_interest_usd\":459160.16,\"proposed_scheduled_lifetime_cost_including_fees_usd\":467160.16,\"proposed_scheduled_lifetime_cost_higher_by_usd\":70651.76}",
      "interpretation": "The modeled refinance lowers the first-month combined payment and the five-year borrowing cost, but it has a higher scheduled lifetime cost if paid only as scheduled.",
      "guardrail": "This is not a savings promise. It assumes fixed rates and fixed payments, excludes taxes and insurance, and does not establish Texas constitutional or loan-program eligibility.",
      "source_ids": "cfpb-debt-consolidation|cfpb-loan-estimate-comparison|texas-constitution-article-xvi",
      "source_reviewed_date": "2026-09-03",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "high-dti-conditional-debt-exclusion",
      "example_title": "High-DTI example with conditional debt exclusion",
      "example_type": "debt-to-income-comparison",
      "hypothetical": true,
      "assumptions_json": "{\"qualifying_gross_monthly_income_usd\":12000,\"complete_current_housing_expense_usd\":3000,\"other_monthly_debt_payments_usd\":3120,\"complete_proposed_housing_expense_usd\":4020,\"modeled_other_debt_payments_after_closing_usd\":0,\"debt_exclusion_is_conditional\":true}",
      "results_json": "{\"current_total_monthly_obligations_usd\":6120,\"current_dti_percent\":51,\"proposed_total_monthly_obligations_usd\":4020,\"proposed_dti_percent\":33.5,\"modeled_dti_reduction_percentage_points\":17.5}",
      "interpretation": "The modeled DTI changes from 51.00% to 33.50% only if the complete proposed housing expense is accurate and the paid debts are permitted to be excluded.",
      "guardrail": "Paying debt at or before closing does not guarantee exclusion from DTI. Treatment depends on the program, debt type, documentation, funding source, underwriting findings, lender requirements, credit history, and complete borrower profile.",
      "source_ids": "fannie-b3-6-02-dti|fannie-b3-6-07-debts-paid",
      "source_reviewed_date": "2026-09-03",
      "dataset_version": "2026.1"
    },
    {
      "example_id": "low-rate-first-mortgage-structure",
      "example_title": "Low-rate first mortgage structure comparison",
      "example_type": "first-mortgage-versus-full-refinance",
      "hypothetical": true,
      "assumptions_json": "{\"current_first_mortgage\":{\"principal_usd\":400000,\"annual_note_rate_percent\":3.25,\"remaining_term_months\":288},\"modeled_second_lien\":{\"principal_usd\":90000,\"annual_note_rate_percent\":8.5,\"term_months\":180},\"modeled_full_refinance\":{\"principal_usd\":490000,\"annual_note_rate_percent\":6.5,\"term_months\":360},\"loan_costs_included_usd\":0}",
      "results_json": "{\"current_first_mortgage_pi_usd\":2002.06,\"modeled_second_lien_pi_usd\":886.27,\"combined_first_and_second_pi_usd\":2888.32,\"modeled_full_refinance_pi_usd\":3097.13,\"full_refinance_monthly_pi_higher_by_usd\":208.81}",
      "interpretation": "Before costs, the modeled first-mortgage-plus-second-lien structure has a lower combined monthly principal-and-interest payment than refinancing the full balance at the stated rate and term.",
      "guardrail": "This is not a recommendation or quote. The example excludes closing costs, taxes, insurance, mortgage insurance, lien terms, and eligibility analysis, all of which can change the decision.",
      "source_ids": "cfpb-debt-consolidation|cfpb-loan-estimate-comparison|texas-constitution-article-xvi",
      "source_reviewed_date": "2026-09-03",
      "dataset_version": "2026.1"
    }
  ]
}