Refinancing: Which Loan Program is for You?
There aren't as many refinance loan programs as there are borrowers, but it seems like it sometimes! Contact us at 8037793638 and we can match you with the refinance program that fits you best. What are your goals for refinancing? Keeping in mind the information below will help you begin your decision process.
Making Your Payments Lower
Is your refinance primarily to lower your rate and monthly payments? If so, applying for a low, fixed-rate loan might be a good choice for you. Maybe you now have a fixed-rate mortgage with a higher rate, or maybe you hold an ARM — adjustable rate mortgage — where the interest rate can vary. Unlike the ARM, your low fixed rate mortgage stays at a certain low rate for the term of the mortgage loan, even as interest rates rise. A fixed-rate mortgage is particularly a good option if you don't plan to sell your home within the next 5 years or so. But if you do expect to sell your home more quickly, you should consider an ARM with a low initial rate to get lower monthly payments.
Is your refinance goal primarily to pull out some equity for an infusion of cash? Maybe you're planning a special vacation; you need to pay college tuition for your child; or you are planning some home improvements. So you will need to find a loan above the remaining balance of your existing mortgage loan.In that case, you'll want to find a loan program for a higher amount than the remaining balance on your current mortgage loan. You may not have an increase in your monthly payemnt, however, if you have had your current loan for a number of years, and/or your loan interest rate is high.
Consolidating Your Debt
Do you want to cash out a portion of your home equity to consolidate additional debt? Good plan! If you hold some higher interest debts (like credit cards or vehicle loans), you may be able to take care of that debt with a loan with a lower rate through your refinance, if you have the right amount of home equity.
Paying it off Faster
Do you hope to build up home equity more quickly, and pay off your mortgage sooner? You should consider refinancing to a short-term loan, such as a 15-year mortgage loan. Although your mortgage payment amount will probably be increased, you can save on interest; so your equity amount will rise up faster. Conversely, if your current longer term loan has a small balance remaining, and was closed a while ago, you may even be able to make the switch without paying more each month. To help you understand your options and the numerous benefits in refinancing, please call us at 8037793638. We are here for you.
Curious about refinancing? Give us a call at 8037793638.