Refinancing: Which Loan Program is for You?
Although it seems like it at times, there are not as many loan options as there are applicants! Call us at (727) 743-1620 and we can help you qualify for the best refinance loan to fit your situation. There are some general questions to ask yourself as you consider the choices.
Lowering Your Payments
Are you refinancing primarily to lower your rate and monthly payments? In that case, applying for a low, fixed-rate loan may be a good choice for you. An ARM (Adjustable Rate Mortgage) or a high fixed rate mortgage are loan programs that you might want to refinance. Unlike the ARM, your low fixed-rate mortgage stays at a certain low rate for the life of the loan, even as interest rates rise. If you are planning to live in your home for about five more years, a loan with a fixed rate may be an especially good choice for you. However, an ARM with a initial low payment may be a smarter way to reduce your payments if you see yourself moving in the next few years.
Is "cashing out" your main purpose for refinancing? It could be you need to make home improvements, pay your child's college tuition bill, or take your family on a dream vacation. With this in mind, you want to look for a loan higher than the remaining balance of your existing mortgage loan.Then you'll want You may not have an increase in your mortgage payemnt, though, if you've had your existing mortgage loan for a number of years, and/or your interest rate is high.
Maybe you'd like to pull out a portion of the equity in your home (cash out) to use toward other debt. If you have a fair amount of equity, taking care of other debt with rates higher than your mortgage (credit cards or home equity loans, for example) might help save you a chunk of cash each month.
Paying it off Sooner
Do you hope to build up equity more quickly, and pay off your mortgage more quickly? If this is your hope, the refinance mortgage can move you to a mortgage loan program with a shorter term, like a 15 year loan. You will be paying less interest and growing your equity more quickly, even though your mortgage payments will likely be higher than they were. However, if you have held your current 30 year mortgage for a long time and the remaining balance is rather low, you might be do this without raising your monthly mortgage payment — it's even possible to save! To help you determine your options and the numerous benefits of refinancing, please contact us at (727) 743-1620. We are here to help you reach your goals!
Want to know more about refinancing? Give us a call: (727) 743-1620.