This is one of the most common reasons that homeowners refinance their mortgage. If your current interest rate is higher than what is currently available in the market, it is probably a good idea to see how much you could save by refinancing. There are no-cost and low-cost options that could save you money with little to no investment.
Take advantage of low rates to reduce the term of Mortgage loan. Shorter terms mean lower rates.
Adjustable rate mortgage (ARM) loans are a great way to ease into your payments, especially if you are a first time buyer or if you need lower payments initially. Eventually, if you decide you will stay in the home longer, you may want to consider refinancing that into a long term fixed rate loan. Doing so will give you peace of mind, knowing that your rate and payment will not change for a set period of time.
Like ARMs, interest-only mortgage loans are a great way to minimize payments at the beginning; however, because you are not paying any principal, your loan balance does not decrease. If you plan to keep your home long term, you probably want to start paying off your loan. Often, you can refinance your interest-only mortgage loan to a 30 year fixed mortgage loan while keeping your payments about the same. Our Loan Officers will help you find the best solution.
If you purchased a home with less than 20% down, chances are you're paying private mortgage insurance (PMI). Refinancing will help you eliminate the extra expense if you've paid down your balance and/or have seen an increase in your home's value to a point where you have at least 20% equity in, or a loan-to-value (LTV) of 80% or less.
Sometimes plans change and the home that you thought you were going to have for awhile turns from a permanent situation into a temporary one. If you are planning to sell sooner than you thought and no longer need a long-term rate, then you may consider converting your 30 year fixed to an ARM. There different types of ARMs to consider including 3/1, 5/1, or 7/1 programs, which often have lower rates and payments. Those ARMs are named for the way they work: for example, a 3/1 ARM has a fixed rate and payment during its first three years, and then it resets annually according to its terms. Similarly, 5/1 ARM rates remain fixed for the first five years of their terms, and so on.
Leveraging your equity is one of the smartest ways you can make your money work for you. Use the cash to pay off higher interest, non tax-deductible credit cards, student loans, or medical bills. By consolidating your debts, you can enjoy the benefit of having only one payment each month, and in most cases your overall monthly outflow decreases.
What better way to use your hard earned equity than to invest it back with repairs or home improvements? Whether you would like to fix your leaky roof or update your kitchen, you can tap into your equity and have a tax deductible way
to tackle your projects.*
*Consult with your tax advisor.
With home prices and interest rates at the lowest they've been in years, if you've been thinking about buying a vacation home or an investment property, now may be a great time to take action on your Mortgage Loan. Tap into the equity and use the cash for your down payment, home improvements, or for any reason at all.