Refinancing: Which Loan Program is for You?

Although it seems like it sometimes, there aren't as many refinance choices as there are borrowers! We can help you find the refinance loan program that can fit your financial situation the best. Contact us at 310-379-5997 to get started. What are your goals for refinancing? Considering in mind the information below will help you narrow your choices.

Lowering Your Payments

Is your refinance primarily to lower your rate and monthly payments? In that case, a low, fixed rate loan may be your best option. An ARM (Adjustable Rate Mortgage) or a high fixed rate mortgage are loans that you might want to refinance. Even when rates rise later, unlike with your ARM, when you qualify for a mortgage with a fixed rate, you lock in that low interest rate for the term of your loan. If you aren't planning a move in the near future (about 5 years), a fixed-rate mortgage can particularly be a wise loan option. But if you do expect to sell your home more quickly, you will need to consider an ARM with a low initial rate to get lower mortgage payments.

Getting Out some Cash

Is your refinance goal primarily to pull out some of your equity for an infusion of cash? Your house needs new carpet; your daughter has been accepted to University and needs tuition; or you are planning a special vacation. With this in mind, you will need to apply for a loan for more than the balance remaining on your current mortgage.With this goal, you'll You will need to get a loan for a higher amount than the balance remaining with your existing mortgage in that case. You may not increase your monthly payemnt, however, if you've had your existing mortgage loan for a long time, and/or your loan interest rate is high.

Consolidating Debt

Maybe you hope to pull out some home equity (cash out) to use toward other debt. If you have any higher interest debts (such as credit cards or car loans), you may be able to pay that debt off with a lower rate loan with your refinance, if you have enough equity.

Getting a Shorter Term Loan

Are you hoping to fatten your home equity faster, and pay your mortgage off more quickly? If this is your plan, the refinance mortgage can move you to a mortgage program with a shorter term, such as a 15 year loan. Even though your mortgage payments will probably be more, you will save on interest; so your home equity will build up faster. Conversely, if your existing longer term loan has a small balance remaining, and was closed a while ago, you could be able to make the change without paying more each month. To help you understand your options and the numerous benefits in refinancing, please call us at 310-379-5997. We can help you reach your goals!

Want to know more about refinancing your home? Call us: 310-379-5997.

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