What is your New Year’s Resolution? If you are a homeowner, and your resolution has to do with saving money, we can help. Low interest rates and the option to change the terms of your loan are great reasons why you should refinance your home in the new year.
Reasons to Refinance
Refinancing your mortgage is essentially taking out a new loan to replace your old mortgage. We can help you make this process quick and efficient. It may seem intimidating, time consuming and costly to refinance, but it is a fairly simple process, and moves much faster than your original mortgage application. For most people, the cost saving benefits in the end far outweigh any upfront costs and we can help to make sure when you refinance, it is the most affordable option for you. Here are some reasons to refinance:
- Pay off your loan quicker with a shorter term: If you had a 30-year mortgage at the start but want to shorten to 20, you will be able to do this when refinancing. Although this option will raise the amount of your monthly payments, the loan will accrue less interest over time and therefore save you money in the long run.
- Get a lower interest rate: Current interest rates are at historic lows and very well may be lower than the one you have now. By refinancing, you are able to pay less interest each month, saving you money.
- Switch between loan types: When refinancing, you can change your loan from a fixed-rate to an adjustable-rate mortgage or vice-versa. There are benefits to both depending on your current situation and how long you plan to stay in the home.
- You have gained enough equity in your home to refinance into a loan without mortgage insurance: This is another way to save you money, without having to also pay the mortgage insurance every month on top of the mortgage payments.
- You are looking to tap a bit of your home equity with a cash-out refinance, which gets you some cash in hand for whatever you may need. This is essentially a loan that is more than the amount remaining on your current mortgage and is a great way to pay down existing debt that is at a higher interest rate.
- Your credit score has increased: Another great reason to refinance is if your credit score has improved. Having a higher credit score ensures you a better rate than when you originally borrowed, and you may be able to get better terms as well as you are now a more trustworthy borrower.
It is best to come up with a goal when deciding to refinance to be sure it is really in your best interest. Our experts will be able to help you through the entire refinancing process from deciding what is best for you, to signing the final papers. Contact us today to get started.