You’re seeing mortgage rates going down and are thinking about refinancing. Before you make a final decision, you need to consider the entire picture. The rate is important, but you need to consider the cost of refinancing as well.
Talk with your loan professional to talk about all the mortgage solutions available. That way you know which one is best for you and your finances.
The reasons for refinancing are almost innumerable. Borrowers have their own reasons for wanting to take out a new mortgage, instead of sticking with their old one. Here are just a few. Which one sounds most familiar to you?
Loan terms are often the main reason for a refinancing decision. It might be the loan term, the interest rate, or the payment amount.
- You are paying PMI and want to get rid of it.
- You currently have a fixed-rate loan and want an adjustable-rate. Or, the other way around.
- You have a 15-year loan term, but need the lower payments of a 30-year mortgage.
- You are currently paying interest only and want to switch to an amortized mortgage.
- You have a second mortgage and want to get down to one payment.
- Your current interest rate is too high.
Want to Extract Equity
Extracting equity is another reason homeowners want to refinance. Depending on the amount of equity available, it could translate to a large amount of cash available all at one time.
- You want to invest cash into investments that provide a higher rate of return.
- You want to pay off other debts and consolidate down to a single monthly payment.
- You are getting a divorce and need to split the equity accrued while taking your ex-spouse off the loan.
- You want to renovate your older home and need money for the work.
- You want to pay for college (for you or your children) without taking out a lot of student loans.
A lot of things can change over the years after you take out your original mortgage.
- You bought the home as a vacation place and now want to refinance it as a primary residence
- Your financial qualifications have improved since the original loan.
Mortgage loans are major financial commitments. Before you refinance, you need to have a strong strategy on how and why you want to make this change. If you make the wrong move, you may find yourself with a mortgage that’s going to cost you far more in the long run.
Your best option is to work with a seasoned mortgage professional who will help you compare low and no-cost refinancing options. You may find your current mortgage is the better choice.
Talk with Gregg Busch and his team about mortgage solutions that would work for your particular situation. They have dozens of options available to help you realize your financial goals without making a major mistake.