Refinancing: Which Option is for You?
The number of refinance options available to borrowers can be overwhelming. Contact us at 410-451-2755 and we will match you with the refinance program that fits you best. In order to review your choices, you can determine what you want to achieve with the refinance.
Reducing Your Monthly Payments
Are achieving reduced monthly payments and a lower rate your main reasons for refinancing? In that case, a low, fixed rate loan may be the best loan program for you. Perhaps you now have a higher rate fixed rate mortgage, or maybe you hold an ARM — adjustable rate mortgage — in which the interest rate varies. Even when interest rates rise, a fixed rate mortgage loan will stay at the same, low interest rate, unlike an ARM. This is especially a good choice if you don't think you'll be selling your home within the next 5 years or so. However, if you do see yourself moving before too long, an ARM with a small initial rate might be the ideal way to bring down your monthly payments.
Refinancing to Cash Out
Is your refinance goal primarily to pull out some of your home equity for an infusion of cash? Maybe you're dreaming of a cruise; you have to pay tuition for your college-bound child; or you plan to renovate your home. In this case, you will want to find a loan for more than the balance remaining of your present mortgage loan.With this goal, you will want If you've had your existing mortgage loan for quite a while and/or have a high interest mortgage, you may be able to do this without increasing your monthly payment.
Do you have other debt, perhaps with higher interest, that you'd like to consolidate? If you hold some higher interest debts (such as credit cards or car loans), you may be able to take care of that debt with a lower rate loan with your refinance, if you have the right amount of equity.
Building up Equity More Quickly
Are you wanting to fatten your home equity faster, and pay off your mortgage sooner? You should consider refinancing to a short-term loan, like a 15-year mortgage. You will be paying less interest and growing your home equity more quickly, although your payments will likely be more than they were. Conversely, if your existing longer term mortgage loan has a small remaining balance, and was closed a number of years ago, you may be able to make the move without paying more each month. To help you understand your options and the multiple benefits of refinancing, please contact us at 410-451-2755. We would love to help you reach your goals!
Want to know more about refinancing? Give us a call: 410-451-2755.