Which Refinancing Loan Program is Best for You?
When you are overwhelmed with so many options, it may seem like there are even more loan programs than borrowers! Contact us at (334) 285-8850 and we can match you with the loan program that is ideal for you. What are your goals for refinancing? Considering in mind the information below will help you narrow your choices.
Making Your Payments Lower
Are getting better monthly payments and a better rate your main refinance goals? In that case, a good choice may be a low fixed-rate loan. Maybe you are now in a mortgage with a high, fixed interest rate, or a mortgage in which the rate of interest varies - an adjustable rate mortgage (ARM). Different that the ARM, your low fixed-rate mortgage will stay at a certain low rate for the life of your mortgage loan, even as interest rates rise. If you are expecting to stay in your home for at least five more years, a fixed rate loan may be a particulary good fit for you. However, if you do see yourself moving within several years, an adjustable rate mortgage with a small initial rate could be the best way to reduce your monthly payments.
Is "cashing out" your main reason for your refinance? Maybe you're planning a special vacation; you have to pay tuition for your college-bound child; or you are updating your kitchen. In this case, you will need to get a loan for more than the balance remaining of your existing mortgage loan.Then you will need You might not increase your monthly payemnt, though, if you've had your existing mortgage loan for a number of years, and/or your interest rate is high.
Perhaps you'd like to cash out some home equity (cash out) to put toward other debt. If you have a fair amount of home equity, paying toward other debt with higher interest that your home loan (credit cards or home equity loans, for example) may be able to save you a chunk of money each month.
Paying it off Faster
Are you wanting to fatten your equity faster, and get your mortgage paid off more quickly? In that case, you want to find out about refinancing to a short term mortgage - like a fifteen-year mortgage loan. Even though your monthly payments will probably be increased, you will save on interest; so your home equity will rise up faster. On the other hand, if your current long-term mortgage loan has a low remaining balance, and was closed a while ago, you may even be able to make the switch without paying more each month. To help you understand your options and the multiple benefits of refinancing, please contact us at (334) 285-8850. We would love to help you reach your goals!
Want to know more about refinancing your home? Give us a call at (334) 285-8850.