Refinancing: Which Option is for You?
The huge number of refinance options available can be overwhelming. Call us at 720-598-8300 and we can work with you to qualify you for the right loan program to fit your financial situation. What do you hope to achieve with refinancing? Considering in mind the information below will help you narrow your choices.
Lowering Your Payments
Are your refinance goals to lower your rate and consequently your mortgage payments? In that case, a low, fixed rate loan may be the best choice for you. Maybe you currently hold a fixed-rate mortgage with a higher rate, or maybe you hold an ARM — adjustable rate mortgage — where the rate of interest can vary. Even when interest rates rise, a fixed-rate mortgage will stay at the same, low interest rate, unlike an ARM. If you are not planning a move in the near future (about 5 years), a fixed-rate mortgage can particularly be a wise option. But if you do expect to sell your home more quickly, you should consider an ARM with a low initial rate to get lower monthly payments.
Refinancing to Cash Out
Is "cashing out" your primary purpose for your refinance? Your home needs new carpet; your daughter has been accepted to college and needs tuition; or you are taking your family on a cruise. Then you will need to qualify for a loan for more than the remaining balance of your existing mortgage loan.So you will You will be looking for a loan for a higher amount than the balance remaining of your present mortgage in that case. If you've had your current mortgage loan for quite a while and/or have a loan with a high interest rate, you may be able to do this without increasing your mortgage payment.
Maybe you want to pull out some of the equity in your home (cash out) to put toward other debt. If you have built up some equity, paying off other debt with higher interest rates that your home loan (credit cards or home equity loans, for example) could be able to save you a chunk of cash every month.
Switching to a Shorter Term Loan
Are you wanting to fatten your equity faster, and get your mortgage paid off more quickly? Then, you want to look into refinancing to a short term mortgage - for example, a fifteen-year mortgage loan. The mortgage payments will probably be higher than they were with a longer term mortgage, but in exchange, that you will pay considerably less interest and will build up equity more quickly. On the other hand, if your current long-term mortgage loan has a small balance remaining, and was closed a while ago, you may even be able to make the move without paying more each month. To help you determine your options and the many benefits of refinancing, please contact us at 720-598-8300. We are here to help you reach your goals!
Want to know more about refinancing? Give us a call: 720-598-8300.