Refinancing: Which Program is for You?
There are not as many loan options as there are borrowers, but it feels like it at times! Contact us at (434) 975-5626 and we'll help you qualify for the right refinance program for your financial situation. What are your reasons for refinancing? Considering in mind the information below will help you narrow your choices.
Lowering Your Payments
Are achieving reduced monthly payments and an improved rate your main reasons for refinancing? In that case, applying for a low, fixed-rate loan might be a good option for you. Maybe you currently hold a higher rate fixed rate mortgage, or maybe you have an ARM — adjustable rate mortgage — with which the interest rate can vary. Even if rates rise later, unlike with your ARM, when you get a fixed rate mortgage, you set the low interest rate for the term of your mortgage. If you expect to stay in your home for at least five more years, a fixed rate mortgage may be an especially good choice for you. However, an ARM with a initial low payment could be a better way to reduce your mortgage payments if you plan on moving in the near future.
Getting Out some Cash
Is your refinance goal primarily to "cash out" some home equity? Perhaps you're planning a special vacation; you have to pay tuition for your college-bound child; or you plan to renovate your home. In this case, you will want to get a loan above the balance remaining on your present mortgage.Then you want to need to qualify for a loan for a bigger number than the balance remaining on your present mortgage. You may not have an increase in your mortgage payemnt, though, if you have had your existing mortgage loan for a long time, and/or your interest rate is high.
Do you want to cash out some of your home equity to consolidate additional debt? Great idea! If you own some higher interest debts (such as credit cards or vehicle loans), you might be able to take care of that debt with a lower rate loan with your refinance, if you have the home equity built up to make it work.
Paying it off Faster
Are you dreaming of paying your loan off sooner, while beefing up your home equity more quickly? Consider refinancing with a short-term loan, like a 15-year mortgage loan. The mortgage payments will probably be higher than they were with a longer term loan, but the pay-off is: that you will pay substantially less interest and can build up equity quicker. However, if you've held your existing thirty-year mortgage for a number of years and the remaining balance is relatively low, you could be do this without raising your monthly payment — it's even possible to save! To help you understand your options and the many benefits of refinancing, please call us at (434) 975-5626. We would love to help you reach your goals!
Curious about refinancing your home? Give us a call at (434) 975-5626.
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