Refinancing: Which Option is for You?
When you are overwhelmed with so many options, it may seem as if there are even more refinance programs than applicants! We can help you locate the refinance loan program that will fit your financial situation the best. Contact us at 253-848-1255 to begin the process. There are some general things to keep in mind as you look at the options.
Making Your Payments Lower
Is your refinance primarily to lower your rate and monthly payments? In that case, getting a low, fixed-rate loan could be a good option for you. An ARM (Adjustable Rate Mortgage) or a high fixed rate mortgage are loan programs that you might want to refinance. Even if interest rates rise, a fixed rate mortgage will remain at the same, low interest rate, unlike an ARM. If you expect to live in your home for about five more years, a loan with a fixed rate may be an especially good option for you. However, an ARM with a initial low payment may be a smarter way to lower your payments if you see yourself moving in the near future.
Are you wanting to cash out some of your equity in your refinance? Maybe you're planning a special vacation; you have to pay college tuition for your child; or you plan to renovate your home. So you'll need to qualify for a loan higher than the remaining balance of your existing mortgage.So you'll want to qualify for a loan program for a bigger number than the remaining balance on your existing mortgage. You may not have an increase in your monthly payemnt, however, if you have had your current mortgage for a long time, and/or your loan interest rate is high.
Do you want to pull out some of your home equity to consolidate other debt? Great plan! If you have built up some equity, paying toward other debt with rates higher than your home loan (credit cards or home equity loans, for example) may be able to save you a chunk of cash each month.
Switching to a Shorter Term Loan
Do you hope to build up equity more quickly, and have your mortgage paid off sooner? In that case, you want to look into refinancing to a short term mortgage loan - for example, a fifteen-year mortgage loan. You will be paying less interest and growing your home equity faster, although your payments will usually be bigger than they were. However, if you have held your existing thirty year loan for a number of years and the remaining balance is somewhat low, you may be able to do this without raising your monthly mortgage payment — it's even possible to save! To help you figure out your options and the many benefits of refinancing, please call us at 253-848-1255. We are here for you.
Curious about refinancing your home? Call us at 253-848-1255.