Which Refinancing Option is Right for You?
There are not as many loan options as there are borrowers, but sometimes it seems like it! Call us at (303) 228-2254 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 consider the options.
Reducing Your Monthly Payments
Are your refinance goals to lower your rate and consequently your mortgage payments? In that case, getting a low, fixed-rate loan could be a good option for you. An ARM (Adjustable Rate Mortgage) or a high fixed rate mortgage are loans that you might want to refinance. Even as interest rates rise, a fixed-rate mortgage must stay at the same, low interest rate, unlike an ARM. If you are not expecting to sell your home in the near future (about five years), a fixed rate mortgage loan can especially be a wise option. However, an ARM with a low intitial payment may be a smarter way to lower your monthly payments if you plan on moving in the near future.
Refinancing to Cash Out
Are you refinancing primarily to pull out some home equity for an infusion of cash? Maybe you want to make home improvements, pay your child's college tuition bill, or take your family on a dream vacation. In this case, you will need to get a loan for more than the balance remaining of your current mortgage.With this goal, you will want to need to get a loan program for a bigger amount than the remaining balance on your current mortgage loan. You may not increase your mortgage payemnt, however, if you've had your current loan for a long time, and/or your interest rate is high.
Perhaps you hope to pull out some home equity (cash out) to put toward other debt. If you have enough home equity, paying off other debt with rates higher than your home loan (credit cards or home equity loans, for example) might help save you a chunk of money every month.
Paying it off Sooner
Do you plan to build up equity more quickly, and pay off your mortgage faster? Consider refinancing with a shorterterm loan, such as a 15-year mortgage. You will be paying less interest and growing your home equity faster, although your monthly payments will generally be more than you were paying. However, if you've had your existing thirty-year mortgage loan for a number of years and the loan balance is relatively low, you might be do this without increasing your monthly mortgage payment — you may even be able to save! To help you figure out your options and the many benefits in refinancing, please call us at (303) 228-2254. We are here for you.
Curious about refinancing? Call us: (303) 228-2254.