Choosing a Refinancing Program
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There are not as many loan programs as there are borrowers, but it feels like it at times! Call us at (408) 985-6400 and we can match you with the loan program that fits you best. There are several questions to ask yourself while you consider your options.
Lowering Your Payments
Are your refinance goals to lower your rate and consequently your mortgage payments? In that case, a low, fixed rate loan may be the best option for you. Maybe you now hold a fixed-rate mortgage with a higher rate, or perhaps you hold an ARM — adjustable rate mortgage — in which the interest rate varies. Even when rates get higher later, unlike with your ARM, when you get a fixed-rate mortgage, you set that low interest rate for the life of your loan. If you aren't expecting to move in the near future (about 5 years), a fixed rate mortgage loan can especially be a great option. However, if you can see yourself moving before too long, an ARM mortgage with a low initial rate could be the ideal way to lower your monthly payment. By refinancing your existing mortgage loan, you could wind up paying more in finance charges over the life of the loan.
Refinancing to Cash Out
Is "cashing out" your main purpose for refinancing? Perhaps you need to update your kitchen, pay your child's college tuition bill, or take your dream vacation. Then you want to find a loan for more than the balance remaining of your existing mortgage.Then you want to qualify for a loan for a higher number than the remaining balance on your existing mortgage. However, if your loan interest rate is currently high and you've held it for quite a few years, you could be able to achieve your goals without an increase in your mortgage payment.
Consolidating Your Debt
Perhaps you'd like to cash out a portion of the equity in your home (cash out) to use toward other debt. If you own any debt with steep interest (such as credit cards or vehicle loans), you may be able to pay that debt off with a loan with a lower rate through your refinance, if you have the home equity built up to make it work.
Switching to a Shorter Term Loan
Do you need to build up equity more quickly, and pay off your mortgage more quickly? In that case, you want to look into refinancing to a short term mortgage loan - for example, a fifteen-year mortgage loan. You will be paying less interest and growing your equity more quickly, even though your mortgage payments will likely be bigger than you were paying. However, if you have had your existing 30 year mortgage loan for a number of years and the loan balance is rather low, you could be able to do this without increasing your monthly payment — you might even be able to save! To help you determine your options and the many benefits in refinancing, please contact us at
(408) 985-6400. We are here for you.
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