Refinancing: Which Program is for You?
When you are overwhelmed with so many options, it may seem like there are even more loan programs than applicants! Call us at (916) 434-8915 and we will match you with the refinance program that best fits you. There are several things to have in mind as you review your options.
Reducing Your Monthly Payments
Are you refinancing primarily to lower your rate and monthly payments? If so, getting a low, fixed-rate loan might be a good option for you. Perhaps you now have a fixed-rate mortgage with a higher rate, or maybe you hold an ARM — adjustable rate mortgage — with which the interest rate can vary. Unlike the ARM, your low fixed-rate mortgage will stay at a certain low rate for the life of your loan, even if interest rates rise. A fixed-rate mortgage is particularly a wise choice if you don't think you'll be selling your home within the next five years or so. But if you do expect to sell your home more quickly, you should consider an ARM with a low initial rate to get lower payments.
Refinancing to Cash Out
Are you hoping to cash out some of your home equity in your refinance? Perhaps you need to pay for home improvements, pay your child's college tuition bill, or go on a an Alaskan cruise. With this in mind, you want to look for a loan higher than the balance remaining of your current mortgage.So you You'll be looking for a loan for a higher amount than the remaining balance with your existing mortgage loan in this case. If you've had your existing mortgage loan for quite a while and/or have a high interest mortgage, you might\could be able to do this without increasing your monthly payment.
Consolidating Your Debt
Do you want to cash out a portion of your equity to consolidate other debt? Good plan! If you have the equity in your home for it, paying off other debt with higher interest than the rate on your mortgage (for example: car loans, credit cards, student loans, or home equity loans) means you may be able to save several hundred dollars monthly.
Getting a Shorter Term Loan
Do you want to build up equity quicker, and pay off your mortgage more quickly? If this is your goal, your refinance loan can move you to a mortgage program with a short, for example: a 15 year loan. You will be paying less interest and increasing your equity faster, even though your mortgage payments will likely be bigger than you were paying. Conversely, if your current long-term mortgage loan has a low remaining balance, and was closed a while ago, you could be able to make the move without paying more each month. To help you determine your options and the many benefits in refinancing, please call us at (916) 434-8915. We are here for you.
Curious about refinancing your home? Call us at (916) 434-8915.