Reasons To Refinance
Refinancing can be a smart way to improve for your financial situation. Depending on your circumstances you may want to refinance your mortgage for any of the following reasons:
Lower your rate & payment
A reduction in your mortgage interest rate may have a significant impact in the long-run. Refinancing to lower your monthly payment frees up cash flow, so you can manage your money more effectively. Furthermore, if you plan to stay in your home for a long time, you may want to refinance your mortgage and consider buying down your rate to reduce your monthly payment. If you have equity in your home, refinancing could enable you to lower your mortgage payment and/or eliminate mortgage insurance.
Keep your payment from rising
Adjustable Rate Mortgages, or ARMs, are popular because the interest rates for ARMs are usually lower than traditional fixed rate loans. You might select an ARM if you plan on selling the home before the rate adjusts. But what happens if you're unable to sell your home or you like it so much you don't want to leave? Refinancing your ARM into a fixed rate mortgage could stop your payment from rising when the rate adjusts.
If you have debt outside of your mortgage (credit cards, student loans, auto loans) and you have equity in your home, you may want to refinance to consolidate your debt. A well-structured home refinance could save you money.
Get cash out
Refinancing can allow you to use your home's equity for a variety of purposes, including education expenses, home improvements, other investments and more. Mortgage refinancing is a much better option than using credit cards or personal loans.
Pay off your Home Loan Faster
A mortgage refinance can be structured to pay off your home faster. Instead of refinancing into a typical 30 year mortgage, you could get a 20, 15, or even 10 year fixed so you pay it off quicker.
Eliminate Private Mortgage Insurance (PMI)
If you were unable to make a down payment of at least 20% when you first obtained your mortgage loan, you may be paying PMI. If your house has appreciated and/or you have paid down your existing mortgage, you may be able to mortgage refinance your home to eliminate your monthly PMI payment. Along with possibly lowering your rate, a mortgage refinance could reduce your monthly mortgage payment.
Mortgage Rate Quotes