Buying your home to begin with was probably a tedious process. There was a lot of paperwork, a lot of anxiety, an avalanche of details involved in packing, moving, closing, unpacking. When you think about refinancing, you might remember those headaches and forget the idea. But there are a lot of reasons you might want to give it careful thought. Consider the following:
If rates are lower now than when you originally financed your home, or if you choose an adjustable rate mortgage with a lower initial interest rate than your current rate, your monthly payment will go down (assuming you don’t shorten the term or increase the loan balance significantly). In most refinance transitions, you won’t have to bring money to the closing table either, because you usually include all of the costs to close your loan in the new loan amount.
If you are in a good equity position in your house, you could apply for a cash-out refinance and walk away from the closing table with money to invest or to use for college tuition, home improvements or the purchase of a boat or anything else you’ve been dreaming of all your life.
If you have an adjustable rate mortgage and the worry over the direction of interest rates has been keeping you up at nights, you could refinance into a fixed rate loan and stop all that tossing and turning. By refinancing into a fixed rate mortgage, you interest rate is set and will not change over the lifetime of your loan.
Maybe you need to get control over all the different charge cards and personal debt that has sprung up around you. It is likely that you would end up with a tax advantage by doing so. Ask your tax adviser to be certain. You could refinance your home, using some of the equity to consolidate your debt and just make one convenient, low-interest payment every month.
Refinancing your current 30 year loan to a 15 year or bi-weekly loan may be possible without even raising the payment significantly, particularly if rates were high when you closed your current loan. You could save thousands in interest payment over the life of the loan.
Refinancing is not recommended for everyone. It is important that you assess all your options when considering whether or not to refinance. An Elite Mortgage Capital Loan Consultant will be glad to assist you in determining if the refinance is in your best interest.