Bonus money towards credit cards or equity to house to refinance?

Phil
Unfortunately, I have about $40, 000 in debt on credit cards...one card has a very high rate and others are pretty low. I have a house with almost zero equity...just bought it 15 months ago...with just 5% down. I'm probably even on it since home value drops haven't been huge in midwest. Now, I have about $20, 000 bonus coming in 1 month. Should I dump the $20K on the credit cards? OR...would there be a way to put the $20K towards house equity...then refinance at a lower rate and then take out home equity to pay down high interest card and maybe others...my rate is 6.75, so I thought of even doing a 15 yr instead of my current 30 yr...? Any suggestions? By the way, I paid $159K for house with two mortgages...big one is $119K so I could get it down to under $100K and then hopefully REFI on it...Thanks for any help! Happy New Year!!

Tisa
pay off the cards...this will reduce your monthly expenses and hopefully you will not have to rely on credit cards any more. If you pay down on the house you wil not decrease your monthly payment. You may not be able to refinance given your outstanding debt and the current credit crunch.

Hwa
Pay off the credit cards -- highest interest rate cards first. The credit card interest rate is more than your current mortgage. Your plan to refi and then take an equity loan to pay off the credit cards has just too many ifs and ways to go wrong.If you take the money you had been paying monthly on those credit cards and continue working on the remaining credit card balances, you can probably get them all paid off within 18 to 24 months. Then you can work on making extra principal payments on your mortgage or refinancing for a better rate.