Thinking about refinancing your mortgage? Learn the facts before you decide if that's the right choice for you! Although refinancing offers the financial relief, rate stability, and access to money that you may not be able to get by other means, there are occasions that we caution our clients against it.
We respect your unique financial circumstances, and we tailor our mortgage services to your needs. Read on to find out if refinancing should be in your future and for a more accurate refinancing assessment, please call our office.
Your reasons for refinancing are unique. You may be turning to refinance to take advantage of current favorable rates, or you could be looking to change your adjustable mortgage into something stable like a 30-year fixed loan. Many of our clients refinance to get access to the equity they've built up in their home. Is this the case in your situation? Do you want to pay off debt, finance a new business, or take an overdue vacation?
There are many variables to consider when deciding if refinancing makes sense for you and your goals is one of them.
Consider refinancing if it results in a positive change in your financial situation as a homeowner. The results largely depend on your homeownership intentions, namely, how much longer do you expect to own your home.
Here are some common scenarios where refinancing may be worth it:
No Closing Cost Refinancing – There are instances where a no closing cost refinance is available. In this situation, it can drop your interest rate considerably and boost your long-term savings by lowering your monthly payments by a couple of hundred dollars. If you intend on staying at your home for the next 2-5 years, refinancing may be a good deal for you.
Call our office to learn more about the refinancing program we offer.
Regular Refinancing – If you plan on owning the home for many years to come, a regular refinancing option may be the way to go. It typically involves closing costs. However, they often can be included in the loan for no out-of-pocket-cost to you.
Another benefit is that this type of refi usually has the lowest rates. If you can drop your interest rate by a point while keeping your mortgage term the same, the savings will continue for life of the loan.
Cash-out Refinancing – In this scenario, you may find yourself in a situation where you need a large sum of money. This may be to pay for a wedding, pay for your child's tuition, or maybe to do some much-needed upgrades to your home. Your equity is an excellent source of money in these instances, however, keep in mind may also extend the life of your loan.
There's no easy yes or no answer to this question. Refinancing, as it is with all your finances, is a personal choice. Our lending goal is to present the facts to borrowers with clarity so that they can take charge of their homeownership and financial future.