Choosing a Refinancing Option
There are not as many loan programs as there are applicants, but it seems like it at times! Contact us at (707) 252-2700 and we will help you qualify for the best refinance loan for your situation. In order to review your options, you can think about what you want to achieve with your refinance.
Making Your Payments Lower
Are you refinancing primarily to lower your rate and monthly payments? In that case, applying for a low, fixed-rate loan might be a good option for you. Perhaps you currently hold a fixed-rate mortgage with a higher rate, or perhaps you hold an ARM — adjustable rate mortgage — in which the interest rate can vary. Even if rates get higher later, unlike with your ARM, when you close a fixed-rate mortgage, you lock in the low rate for the term of your loan. This can be particularly a good idea if you aren't expecting a move within the next 5 years or so. However, if you do see yourself moving within several years, an adjustable rate mortgage with a low initial rate may be the best way to bring down your monthly payments.
Refinancing to Cash Out
Are you hoping to cash out some of your home equity with your refinance? Maybe you want to update your kitchen, take care of your college kid's tuition, or go on a dream vacation. With this in mind, you'll need to apply for a loan for more than the remaining balance on your current mortgage loan.With this goal, you will want to find a loan program for a bigger number than the remaining balance on your existing mortgage. However, if your mortgage rate is high now and you have held it for a long time, you could be able to achieve your goals without making your monthly payments rise.
Perhaps you want to pull out a portion of the home equity (cash out) to put toward other debt. If you hold any debt with steep interest (like credit cards or vehicle loans), you may be able to take care of that debt with a lower rate loan through your refinance, if you have enough equity.
Building up Equity More Quickly
Are you wanting to fatten your home equity faster, and get your mortgage paid off more quickly? In that case, you want to look into refinancing to a short term mortgage - such as a fifteen-year loan. The monthly payments will probably be more than with your longer term mortgage, but the pay-off is: you will pay quite a bit less interest and can build up equity quicker. On the other hand, if your existing longer term loan has a small remaining balance, and was closed a number of years ago, you may even be able to make the change without paying more each month. To help you understand your options and the numerous benefits of refinancing, please contact us at (707) 252-2700. We are here for you.
Want to know more about refinancing? Give us a call at (707) 252-2700.