Which Refinancing Loan Program is Best for You?
When you are overwhelmed with all the choices, it may seem like there are even more refinance programs than applicants! Contact us at (207) 571-8034 and we can work with you to qualify you for the best refinance program to fit your situation. What are your reasons for refinancing? Keeping in mind the information below will help you begin your decision process.
Lowering Your Payments
Are your refinance goals to lower your rate and consequently your mortgage payments? Then a good option may be a low fixed-rate loan. An ARM (Adjustable Rate Mortgage) or a high fixed rate mortgage are loan programs that you may want to refinance. Even when interest rates rise, a fixed rate mortgage will remain at the same, low interest rate, unlike an ARM. If you are not expecting to move in the near future (about five years), a fixed-rate mortgage can especially be a wise choice. However, if you do see yourself selling your home in the near future, an ARM with a low initial rate could be the best way to lower your monthly payments.
Getting Out some Cash
Is "cashing out" your primary reason for refinancing? Perhaps you want to update your kitchen, pay your child's college tuition bill, or take your family on a dream vacation. Then you'll need to get a loan above the remaining balance of your current mortgage loan.Then you'll You will be looking for a loan for more than the current balance of your current mortgage in this case. You may not have an increase in your mortgage payemnt, though, if you have had your existing mortgage loan for a number of years, and/or your interest rate is high.
Do you want to pull out some home equity to consolidate additional debt? Good plan! If you have enough home equity, taking care of other debt with rates higher than your home loan (credit cards or home equity loans, for example) might be able to save you a chunk of cash every month.
Paying it off Faster
Are you dreaming of paying your loan off sooner, while building up your equity faster? In that case, you need to find out about refinancing to a short term mortgage - such as a fifteen-year loan. Although your monthly payments will usually be more, you will be paying less interest; so your equity amount will build up faster. But, you might be able to make the change without much increase in your monthly payment if your longer term mortgage loan was closed a while ago, and the remaining balance is somewhat low. You may even make it lower! To help you figure out your options and the many benefits of refinancing, please call us at (207) 571-8034. We can help you reach your goals!
Want to know more about refinancing? Give us a call: (207) 571-8034.