Which Refinancing Option is Best for You?

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Although it seems like it sometimes, there aren't as many loan programs as there are applicants! We can guide you to find the loan program that can fit your financial situation the best. Contact us at 480-831-1588 to get started. There are some general things to bear in mind while you review your options.

Reducing Your Monthly Payments

Are your refinance goals to lower your rate and consequently your mortgage payments? In that case, applying for a low, fixed-rate loan could be a wise choice for you. Maybe you currently hold a higher rate fixed rate mortgage, or perhaps you hold an ARM — adjustable rate mortgage — in which the interest rate can vary. Even if interest rates rise, a fixed-rate mortgage will remain at the same, low interest rate, unlike an ARM. A fixed-rate mortgage can be particularly a wise option if you aren't expecting a move within the next five years or so. But if you do plan to move more quickly, you should consider an ARM with a low initial rate to get lower mortgage payments. Refinancing may also cause your finance charges to be higher over the life of the loan.

Cashing Out

Are you refinancing primarily to pull out some home equity for an infusion of cash? Your house needs improvements; your daughter has been accepted to University and needs tuition money; or you are taking your family on a cruise. With this in mind, you will need to apply for a loan for more than the remaining balance on your current mortgage loan.With this goal, you want to find a loan program for a higher amount than the remaining balance on your existing mortgage. If you've had your current mortgage loan for quite a while and/or have a mortgage with a high interest rate, you may be able to do this without making your mortgage payment higher.

Debt Consolidation

Maybe you want to cash out some of the equity (cash out) to put toward other debt. If you have a fair amount of equity, paying toward other debt with higher interest rates that your home loan (credit cards or home equity loans, for example) may help save you a lot of cash every month.

Building up Equity More Quickly

Are you wanting to fatten your home equity faster, and pay your mortgage off sooner? Then, you'll want to find out about refinancing to a short term mortgage loan - for example, a fifteen-year loan. You will be paying less interest and growing your home equity faster, even though your mortgage payments will usually be more than they were. Conversely, if your current longer term mortgage has a low remaining balance, and was closed a while ago, you could be able to make the change without paying more each month. To help you figure out your options and the numerous benefits in refinancing, please contact us at 480-831-1588. We will help you reach your goals!