Which Refinancing Option is Right for You?
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Although it may seem like it sometimes, there are not as many refinance options as there are borrowers! Call us at 512-505-6267 and we will match you with the loan program that fits you best. What do you hope to achieve with refinancing? Keeping in mind the following will help you narrow your choices.
Reducing Your Monthly Payments
Are getting reduced payments and a better rate your main refinance goals? Then a low, fixed rate loan may be the ideal option for you. Maybe you currently hold a higher rate fixed rate mortgage, or maybe you have an ARM — adjustable rate mortgage — in which the rate of interest varies. Even if rates come up later, unlike with your ARM, when you get a fixed rate mortgage, you lock in that low rate for the term of your mortgage. If you are not planning on moving in the near future (about five years), a fixed rate mortgage loan can particularly be a wise option. On the other hand, if you can see yourself selling your home within several years, an ARM mortgage with a small initial rate may be the ideal way to bring down your monthly payments.
Refinancing to Cash Out
Are you planning to cash out some of your home equity with your refinance? It could be you're planning a special vacation; you need to pay college tuition for your child; or you are planning some home improvements. In this case, you need to look for a loan for more than the balance remaining of your current mortgage.In this case, you will want 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 increasing your mortgage payment.
Consolidating Your Debt
Perhaps you'd like to cash out a portion of the home equity (cash out) to put toward other debt. If you have the equity in your home for it, paying off other debt with higher interest than the rate on your mortgage (like home equity loans, student loans, or credit cards) means you can possible save several hundred dollars monthly.
Paying it off Faster
Are you dreaming of paying off your loan more quickly, while beefing up your equity faster? Then, you want to look into refinancing to a short term mortgage - such as a fifteen-year mortgage loan. The mortgage payments will probably be more than with a long-term mortgage, but in exchange, that you will pay substantially less interest and can build up equity quicker. Conversely, if your existing long-term mortgage has a low balance remaining, and was closed a while ago, you could be able to make the move without paying more each month. To help you understand your options and the numerous benefits in refinancing, please contact us at 512-505-6267. We are here to help you reach your goals!