Which Refinancing Loan Program is Best for You?
Although it seems like it sometimes, there are not as many refinance choices as there are applicants! Call us at (512) 291-6100 and we can work with you to qualify you for the best loan program to fit your needs. There are several questions to ask yourself as you look at your options.
Reducing Your Monthly Payments
Are you refinancing primarily to lower your rate and monthly payments? If so, the best option may be a low fixed-rate loan. Maybe you currently have a higher rate fixed rate mortgage, or perhaps you have an ARM — adjustable rate mortgage — where the rate of interest varies. Even as interest rates rise, a fixed-rate mortgage loan will stay at the same, low interest rate, unlike an ARM. If you are expecting to stay in your home for about five more years, a fixed-rate loan may be an especially good choice for you. On the other hand, if you can see yourself moving before too long, an ARM mortgage with a small initial rate could be the best way to bring down your monthly payments.
Is "cashing out" your main reason for your refinance? Perhaps you're going on a much needed vacation; you have to pay college tuition for your child; or you are planning some home improvements. So you will want to get a loan higher than the remaining balance on your present mortgage loan.With this goal, you'll want to find a loan program for a higher amount than the balance remaining on your current mortgage. You may not have an increase in your mortgage payemnt, however, if you have had your existing loan for a long time, and/or your interest rate is high.
Perhaps you'd like to pull out some equity (cash out) to put toward other debt. If you have some debt with higher interest (such as credit cards or car loans), you might be able to pay that debt off with a loan with a lower rate through your refinance, if you have the right amount of home equity.
Building up Equity More Quickly
Do you hope to build up home equity quicker, and pay off your mortgage sooner? You should consider refinancing to a shorterterm loan, often a 15-year mortgage loan. You will be paying less interest and increasing your home equity faster, although your payments will generally be bigger than they were. But, you could be able to switch without much increase in your monthly payment if your longer term mortgage loan was closed a while back, and the balance remaining is somewhat low. You may even pay less! To help you figure out your options and the numerous benefits in refinancing, please contact us at (512) 291-6100. We are here for you.
Curious about refinancing your home? Give us a call: (512) 291-6100.