Refinancing: Which Option is for You?
There are an enormous number of refinancing options available to borrowers. Contact us at (773) 774-9040 Ext 121 and we can match you with the loan program that fits you best. There are some general questions to ask yourself as you consider your choices.
Making Your Payments Lower
Is your refinance primarily to lower your rate and monthly payments? In that case, your best option could be a low fixed-rate loan. An ARM (Adjustable Rate Mortgage) or a fixed mortgage with a high rate are loan programs that you might want to refinance. Even if rates get higher later, unlike with your ARM, when you get a fixed-rate mortgage, you set the low rate for the term of your mortgage. If you aren't expecting to move in the near future (about five years), a fixed-rate mortgage can especially be a wise choice. But if you do plan to sell your home more quickly, you will want to consider an ARM with a low initial rate in order to achieve reduced mortgage payments.
Is "cashing out" your primary reason for your refinance? It could be you want to update your kitchen, pay your child's college tuition bill, or go on a special family vacation. In this case, you will want to qualify for a loan higher than the balance remaining of your current mortgage loan.Then you will You will be looking for a loan for more than the current balance with your current home loan in that case. If you've had your current mortgage for a number of years and/or have a high interest mortgage, you may be able to do this without increasing your mortgage payment.
Consolidating Your Debt
Do you want to pull out a portion of your home equity to consolidate additional debt? Yes you can! If you own some debt with higher interest (such as credit cards or car loans), you might be able to pay that debt off with a lower rate loan with your refinance, if you have enough equity.
Paying it off Faster
Do you need to build up home equity more quickly, and have your mortgage paid off sooner? If this is your hope, your refinance mortgage can move you to a mortgage loan program with a shorter term, like a 15 year loan. Although your monthly payments will usually be increased, you will save on interest; so your equity amount will rise up faster. On the other hand, if your existing longer term loan has a low balance remaining, and was closed a while ago, you may be able to make the change without paying more each month. To help you figure out your options and the multiple benefits in refinancing, please contact us at (773) 774-9040 Ext 121. We are here for you.
Curious about refinancing your home? Call us at (773) 774-9040 Ext 121.