Refinancing: Which Option is for You?
When you are overwhelmed with so many options, it may seem as if there are even more loan programs than borrowers! Call us at (443) 619-7900 and we can match you with the refinance loan program that best fits you. There are some general things to have in mind while you look at the options.
Lowering Your Payments
Are getting lower monthly payments and an improved rate your main refinance goals? In that case, getting a low, fixed-rate loan could be a wise option for you. An ARM (Adjustable Rate Mortgage) or a fixed mortgage with a high rate are loan programs that you might want to refinance. Even if interest rates rise, a fixed-rate mortgage loan must stay at the same, low interest rate, unlike an ARM. If you are expecting to stay in your home for at least five more years, a fixed-rate loan may be an especially good fit for you. However, an ARM with a low intitial payment could be a smarter way to lower your mortgage payments if you expect to move in the near future.
Is your refinance goal mainly to pull out some equity for an infusion of cash? Perhaps you're going on a much needed vacation; you have to pay college tuition for your child; or you plan to renovate your home. So you need to find a loan above the balance remaining on your present mortgage loan.With this goal, you need You may not increase your monthly payemnt, though, if you have had your current loan for a long time, and/or your interest rate is high.
Do you want to cash out some of your equity to consolidate additional debt? Excellent idea! If you have built up some home equity, taking care of other debt with higher interest that your mortgage loan (credit cards or home equity loans, for example) could help save you a lot of cash each month.
Building up Equity Faster
Do you want to build up home equity quicker, and have your mortgage paid off faster? Then, you'll want to look into refinancing to a short term mortgage - such as a fifteen-year mortgage loan. You will be paying less interest and increasing your equity more quickly, even though your payments will generally be higher than they were. However, if you have held your existing thirty year mortgage for a number of years and the remaining balance is rather low, you might be able to do this without raising your mortgage payment — you might even be able to save! To help you determine your options and the numerous benefits in refinancing, please call us at (443) 619-7900. We would love to help you reach your goals!
Want to know more about refinancing your home? Give us a call at (443) 619-7900.