Your home's financing isn't final. The decisions
you made when you bought your home were based on your financial situation
at the time. However, your income, the mortgage market and the real
estate market can change. This is why you should always assess the
applicability of your mortgage to your current situation and future plans
to determine if a refinance is in order. There are a variety of reasons
why you might want to refinance:
advantage of a lower interest rate.
Rates have been at historic lows, but there is no guarantee how long
this will last. If you can get in now before they begin to climb,
you can keep your monthly payments low.
a fixed rate over an adjustable-rate mortgage.
If your current loan is an ARM that will soon adjust upwards, you
might prefer the stability offered by a fixed-rate mortgage.
needed cash. Cashing out a certain amount at a
mortgage's much lower rate to pay off a debt — say, a credit card —
at a much higher rate often makes solid financial sense.
your loan terms. Opting for a shorter loan term — say,
15 years instead of 30 — will help you pay off your debt sooner and
save significant money over the term of the loan. If your income has
decreased you may wish to extend the term of the loan.
private mortgage insurance. PMI is required of borrowers who put
down less than 20 percent on their home. If you've been in the home
a while, you may have gained enough equity so that you no longer
need the PMI.
your first and second mortgages. This could mean
significant savings for you over the long term.
With 25 years closing mortgage loans Caroline Gerardo has the know how to help you find what is right for your life, even if it is best to keep the loan you have.
Whatever your reasons for wanting to refinance, there are a number of
factors you'll want to consider. With California property values increasing in many areas, this might be important to review.
Another key concern is whether or not the costs of a refinance are
recouped by your lower rate. All loans have closing costs associated with
them, and you want to make sure that whatever savings your new loan
delivers will also be worth the closing costs. Typically, you want to
make back your closing costs within two years.
As you can see, there is a lot to consider, which is why it makes sense
to sit down with an expert and review all the key
considerations and do all the necessary calculations to ensure you're
making the smartest financial decision you can.
Are you considering refinancing your home loan? If so, I
would love to help you make the most informed decision possible. Please
contact me today! (949) 784-9699
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