Beginning 2020: Time To Refinance
As mortgage rates have fallen to historic lows, mortgage applications have risen more than 30% nationally. Lower rates act as an incentive for home purchases and refinancing home loans. If you are thinking about buying a home, or if you already have a mortgage but haven’t yet refinanced your home for a better rate, now could be the best opportunity yet.
As the demand grew in the beginning of 2020 for refinance, there is also a huge rise in mortgage applications for home puchases too. According to the Mortgage Bankers Association refinance applications were up 109% from last year! Purchase applications – loans to buy homes – rose 16%! Don’t miss out on the current low rates, talk to one of our home loan specialists / mortgage bankers for more information.
Top 5 Reasons To Consider Refinancing!
1. Lower Payments
When you purchased or last refinanced your home, your interest rate was determined by the current financial environment and the loan program that you choose at the time. However, interest rates fluctuate. By refinancing your mortgage when interest rates are lower, you can exchange a higher interest rate for a lower one, which will lower your monthly payment and give you more disposable income to pay other bills or put into a savings plan. In addition, if you’ve enhanced your credit score, your equity, income, or other lending factors, then you may be eligible for a better interest rate.
2. Cash-out Refinancing
One way to put more money in your pocket is to tap into the equity you’ve built in your home through a cash-out refinance. With a cash-out refinance, you can refinance for an amount higher than your current principal balance and take the extra funds as cash. This can give you money for everything from remodeling your home, paying off high-interest rate bills, sending your kids to college, or reinvesting th equity into other investments.
3. Shorten the Length of Your Mortgage
Another advantage of home refinancing is that you can shorten the term of your mortgage which may save you thousands of dollars in interest payments over the life of the loan. This can allow you to save or reinvest this capital. Also, if the refinance rate is lower you may build up equity in your home faster,
4. Private Mortgage Insurance (PMI)
If you were unable to make a down payment of 20 percent when you originally purchased your home, you may have had to purchase private mortgage insurance (PMI). If your house has appreciated since then, and you’ve steadily paid down your mortgage, your equity may now be more than 20 percent. Refinancing may help you remove the PMI and lower your monthly payment.
5. Exchange an Adjustable Rate (ARM) for a Fixed Refinance Rate (FRM)
ARMs make a lot of sense for a large number of borrowers with certain financial goals for a specific period of time. However, as interest rates fluctuate, that adjustable rate will eventually reset to a different interest rate, which is variable and depends upon the interest rates at the time.
Get Started Today!
A quick conversation with any one of our home loan refinance specialists can help you decide if a refinance can match your personal financial goals. Let us work with you and your family to get started today!