Refinancing: Which Loan Program is for You?
When you are overwhelmed with so many options, it may seem as if there are even more refinance programs than applicants! Contact us at 719-425-2226 and we will match you with the refinance program that is best for your needs. In the interest of looking at your options, you should think about your goals for your refinance.
Making Your Payments Lower
Are your refinance goals to lower your rate and consequently your mortgage payments? If so, the best choice could be a low fixed-rate loan. Perhaps you now hold a higher rate fixed rate mortgage, or perhaps you hold an ARM — adjustable rate mortgage — with which the rate of interest varies. Even when rates rise later, unlike with your ARM, when you close a fixed-rate mortgage, you lock in the low rate for the life of your mortgage. If you are not expecting to sell your home in the near future (about 5 years), a fixed-rate mortgage can especially be a good choice. However, if you do see yourself selling your home within the next few years, an ARM with a low initial rate might be the ideal way to reduce your monthly payments.
Refinancing to Cash Out
Are you planning to cash out some of your home equity in your refinance? Maybe you're planning a special vacation; you have to pay tuition for your college-bound child; or you plan to renovate your home. Then you want to qualify for a loan higher than the remaining balance of your present mortgage loan.In this case, you'll want However, if your loan interest rate is high now and you've held it for quite a few years, you may be able to reach your goals without an increase in your mortgage payment.
Do you hold other debt, perhaps with a high interest rate, that you'd like to consolidate? If you have the equity in your home to make it work, paying off other high interest debt (such as credit cards, home equity loans, or car loans) means you may be able to save several hundred dollars each month.
Paying it off Faster
Are you wanting to fatten up your equity faster, and pay off your mortgage more quickly? Consider refinancing to a short-term loan, such as a 15-year mortgage. The monthly payments will likely be more than with the longer term mortgage, but the pay-off is: you will pay quite a bit less interest and can build up equity more quickly. But, you could be able to make the change without a bigger monthly mortgage payment if your longer term mortgage loan was closed a while ago, and the remaining balance is somewhat low. You could even pay less! To help you determine your options and the numerous benefits of refinancing, please call us at 719-425-2226. We are here for you.
Want to know more about refinancing? Give us a call: 719-425-2226.