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How to Determine if it's Time to Refinance
(ARA) - Who wouldn't enjoy a break on their monthly mortgage payment? On the other hand, how can you be sure the timing is right to refinance?
Are the rates and the current mortgage market the best indicators? What about other factors having to do with your mortgage, such as mortgage insurance and rising payment amounts?
If your first mortgage has a fixed rate, you can easily compare it to current mortgage rates and know with relative certainty whether refinancing now makes sense. In the absence of any other pressures, as long as the rate you have on a fixed rate loan is lower than current rates, you should probably stick with it.
On the other hand, if you have an adjustable rate mortgage (ARM) and rates are rising, your payment will also be increasing. In this case, consider how much rates will climb and how much more you'll be paying per month. You may consult with a financial planner or loan officer to get their opinions on market trends. With their advice, you can decide if refinancing
to a fixed rate now is more beneficial in the long run.
You're probably beginning to see that the right time to refinance has more to do with you than with the mortgage market. Sure, low interest rates are a factor, but your individual situation is the greatest indicator. For example, are you paying on a loan that requires you to carry mortgage insurance? Have you built up enough equity to drop that insurance through a refinance? If so, refinancing could save you hundreds each month, even if rates have remained unchanged or have increased slightly.
Did you sign a three- or five-year adjustable rate mortgage (ARM) in the last few years? If so, be sure you know when your introductory term expires. You'll want to get a head start on refinancing your loan unless you're prepared to begin making a much higher payment. This type of loan allows you to make reduced (usually interest-only) payments for the first several years. After that time expires, the loan reverts to a regular amortized loan with principal and interest payments. Unless your income has increased significantly, these payments could be an ugly shock.
Don't wait for this unpleasant surprise! If the introductory period on your three-year, five-year, or other loan is set to expire, beat increased payments to the punch before the first one hits your mailbox.
Sometimes, lowering your mortgage payment is not the primary focus. You may be thinking about paying down some of your high-interest debt, have a child going off to college soon, or be dreaming about a newly remodeled kitchen or bathroom. Getting cash out of your home may be the ticket. You can get cash out through a refinance that will allow you to draw against the equity in your home without taking out a second mortgage.
All of these and many others make up the list of reasons homeowners may choose to refinance their homes. Current interest rates are only part of the equation. Establish your goals, learn about your options, and make the decision that's best for you and your timetable.
Find the Best Deal on Refinancing Your Home
(ARA) - Do you have a balloon mortgage that is coming due or an adjustable rate mortgage payment that has been steadily creeping up as interest rates change? Or perhaps you've had an unexpected financial hit such as a large hospital bill or a job loss that has made your current mortgage payments unreasonable. If so, refinancing your mortgage can be a great way to save money every month.
Refinancing your mortgage also lets you consolidate other debt, such as credit card balances, into one low-interest loan. You may also want to consider converting some of the equity in your home to cash to use for large expenses such as college tuition or home improvement.
Online services like Bills.com make it easier than ever to find the best deal on refinancing your home. With a couple clicks of the mouse, you'll receive quotes from up to four lenders so you can choose the best deal for your situation.
Before you refinance, ask yourself the following questions:
* How long will I be in my house? If you're planning to move soon, it may not make sense to refinance. Calculate how much you would save monthly, and then compare that number to the costs of refinancing to make your decision. You can find a number of refinance calculators on the Internet, including at Bills.com.
* Can I afford to cash out equity in my home? Paying college tuition is a good use of your home equity. Taking the value out of your home to take the family to Disney World may be fun, but in the long run, not wise. Just remember how long it took you to build up that equity.
* Can I change my habits? Using a home refinancing to consolidate debt can be a good idea - but only if you don't revert to your old behavior. Clearing your credit card debt and then starting the cycle of maxing them out again means you'll end up back at the same spot. If you are consolidating debt, cut up your credit cards or resolve to pay them off in full each month.
When you're ready to refinance, Bills.com makes it simple. Just fill out the short information form on the Web site, hit submit and up to four lenders will make you an offer. The site only asks for non-sensitive information such as the current value of your home, whether you're employed, if you've ever declared bankruptcy. You will not be required to supply personal information such as a Social Security number until you get further into the process.
Visit Bills.com to find out more about refinancing your mortgage, or to get bids from up to four lenders.
Find the Best Deal on Refinancing Your Home
(ARA) - Do you have a balloon mortgage that is coming due or an adjustable rate mortgage payment that has been steadily creeping up as interest rates change? Or perhaps you've had an unexpected financial hit such as a large hospital bill or a job loss that has made your current mortgage payments unreasonable. If so, refinancing your mortgage can be a great way to save money every month.
Refinancing your mortgage also lets you consolidate other debt, such as credit card balances, into one low-interest loan. You may also want to consider converting some of the equity in your home to cash to use for large expenses such as college tuition or home improvement.
Online services like Bills.com make it easier than ever to find the best deal on refinancing your home. With a couple clicks of the mouse, you'll receive quotes from up to four lenders so you can choose the best deal for your situation.
Before you refinance, ask yourself the following questions:
* How long will I be in my house? If you're planning to move soon, it may not make sense to refinance. Calculate how much you would save monthly, and then compare that number to the costs of refinancing to make your decision. You can find a number of refinance calculators on the Internet, including at Bills.com.
* Can I afford to cash out equity in my home? Paying college tuition is a good use of your home equity. Taking the value out of your home to take the family to Disney World may be fun, but in the long run, not wise. Just remember how long it took you to build up that equity.
* Can I change my habits? Using a home refinancing to consolidate debt can be a good idea - but only if you don't revert to your old behavior. Clearing your credit card debt and then starting the cycle of maxing them out again means you'll end up back at the same spot. If you are consolidating debt, cut up your credit cards or resolve to pay them off in full each month.
When you're ready to refinance, Bills.com makes it simple. Just fill out the short information form on the Web site, hit submit and up to four lenders will make you an offer. The site only asks for non-sensitive information such as the current value of your home, whether you're employed, if you've ever declared bankruptcy. You will not be required to supply personal information such as a Social Security number until you get further into the process.
Visit Bills.com to find out more about refinancing your mortgage, or to get bids from up to four lenders.
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CONTACT ME FOR ALL YOUR REAL ESTATE NEEDS:
Dawn Strait REALTOR® (864)-918-1799