Refinancing: Which Loan Program is for You?
Although it seems like it at times, there aren't as many loan options as there are applicants! Contact us at (916) 399-5500 and we will work with you to qualify you for the best refinance loan to fit your situation. What do you hope to achieve with refinancing? Considering in mind the following will help you begin your decision process.
Reducing Your Monthly Payments
Are you refinancing primarily to lower your rate and monthly payments? If so, your best option might be a low fixed-rate loan. Maybe you are currently in a mortgage loan with a high, fixed interest rate, or a mortgage in which the interest rate varies - an adjustable rate mortgage (ARM). Even if rates get higher later, unlike with your ARM, when you get a fixed rate mortgage, you lock in the low rate for the life of your loan. If you are expecting to stay in your home for about five more years, a fixed rate mortgage may be an especially good fit for you. But if you do plan to move more quickly, you will need to consider an ARM with a low initial rate in order to achieve reduced payments.
Are you hoping to cash out some of your home equity with your refinance? Perhaps you need to update your kitchen, take care of your college kid's tuition, or go on a dream vacation. With this in mind, you need to look for a loan for more than the remaining balance on your current mortgage loan.Then you'll want If you've had your current mortgage loan for quite a while and/or have a high interest mortgage, you might\could be able to do this without making your mortgage payment bigger.
Do you want to cash out some home equity to consolidate other debt? Good plan! If you have the home equity to make it work, taking care of other debt with higher interest than the rate on your mortgage (such as home equity loans, student loans, or credit cards) means you can save possibly several hundred dollars a month.
Paying it off Sooner
Are you dreaming of paying off your loan more quickly, while building up your home equity quicker? You should consider refinancing to a shorterterm loan, such as a 15-year mortgage loan. The payments will probably be higher than they were with a long-term mortgage, but the pay-off is: you will pay considerably less interest and will build up equity quicker. But, you could be able to make the change without a bigger monthly payment if your long term loan was closed a while ago, and the balance remaining is small. You could even pay less! To help you figure out your options and the multiple benefits in refinancing, please call us at (916) 399-5500. We are here for you.
Curious about refinancing your home? Call us at (916) 399-5500.