4 Reasons to Refinance Your Mortgage Now
Nov 08, 2016
Over time, the initial mortgage program you purchased your home with may no longer be the best option for you and your family. That is why many people choose to refinance, which means to trade in your old loan for a new one with a different interest rate and term. While there are both positives and negatives to refinancing, below are some reasons you may want to consider refinancing your mortgage now.
Benefits to Refinancing Your Mortgage
1. Lower Your Monthly Payment
One of the most common reasons that people refinance their mortgages is to lower their interest rates. As long as mortgage rates are lower than when you originally took your mortgage out, refinancing can lower your monthly payment. Keep your mortgage term in mind if you do not want to reset the clock on your payments.
2. Your Credit Score has Improved
If you have improved your credit score and cleaned up some negative things that were tarnishing your borrower profile, it’s a good idea to think about refinancing. Improving your borrower profile can help you qualify for a lower interest rate than your current one, which saves you money each month.
3. Change Your Loan Type
With so many different types of loan programs available, the best program for your needs will change over the 15 to 30 years you spend paying off your mortgage. Many first time homebuyers choose an adjustable rate mortgage because the rates are low in the beginning. But after a few years, they want to switch to a fixed rate mortgage because adjustable rates may fluctuate.
4. To Get Money
Many people who are looking to make home improvements or buy an investment property refinance their home in order to pay for it. A cash-out refinance allows homeowners to refinance their existing mortgage to tap into their home equity. Keep in mind that once the refinance is complete, your new loan will consist of the balance before you refinanced plus the cash-out amount. This means the size of your mortgage and payment will increase.
Refinance Your Mortgage Today
If you are thinking about refinancing your mortgage, contact the experts at Home Point Financial today. We are happy to talk with you to figure out the best way to lower your monthly mortgage payments.