Refinancing: Which Option is for You?
There are a huge number of refinancing options available to borrowers. Call us at (760)789-9995 and we can match you with the refinance loan program that best fits you. In order to review your choices, you need to think about what you want to achieve with the refinance.
Reducing Your Monthly Payments
Are you refinancing primarily to lower your rate and monthly payments? In that case, a low, fixed rate loan may be your best option. An ARM (Adjustable Rate Mortgage) or a high fixed rate mortgage are loan programs that you might want to refinance. Even if rates rise later, unlike with your ARM, when you get a mortgage with a fixed rate, you lock in the low interest rate for the term of your mortgage. If you are expecting to stay in your home for at least five more years, a fixed-rate loan may be a particulary good fit for you. However, an ARM with a low intitial payment could be a better way to lower your payments if you expect to move in the next few years.
Is "cashing out" your primary purpose for refinancing? It could be you want to update your kitchen, pay your child's college tuition bill, or take a cruise. In this case, you'll want to find a loan above the remaining balance on your present mortgage loan.Then you'll You will be looking for a loan for a higher amount than the balance remaining on your existing home loan in this case. If you've had your current mortgage loan for quite a while and/or have a high interest mortgage, you might\could be able to do this without making your mortgage payment bigger.
Perhaps you hope to cash out some of the equity (cash out) to use toward other debt. If you have the home equity to make it work, taking care of other debt with higher interest than the rate on your mortgage (such as home equity loans, student loans, or credit cards) means you may be able to save hundreds of dollars monthly.
Paying it off Faster
Do you want to build up home equity quicker, and pay off your mortgage more quickly? If this is your wish, your refinance loan can move you to a loan program with a shorter term, for example: a 15 year loan. You will be paying less interest and growing your equity more quickly, even though your mortgage payments will likely be more than you were paying. Conversely, if your existing longer term loan has a small remaining balance, and was closed a while ago, you may be able to make the switch without paying more each month. To help you understand your options and the numerous benefits of refinancing, please contact us at (760)789-9995. We would love to help you reach your goals!