Which Refinancing Option is Best for You?
Although it seems like it at times, there aren't as many refinance choices as there are applicants! We can help you find the refinance loan program that can fit your situation the best. Contact us at 630-717-3600 to get things started. There are several questions to ask yourself as you consider the options.
Reducing Your Monthly Payments
Are you refinancing primarily to lower your rate and monthly payments? In that case, applying for a low, fixed-rate loan could be a wise option for you. Maybe you now hold a higher rate fixed rate mortgage, or maybe you have an ARM — adjustable rate mortgage — in which the rate of interest can vary. Different that the ARM, your low fixed rate mortgage stays at a certain low rate for the life of the mortgage loan, even as interest rates rise. If you aren't expecting to move in the near future (about five years), a fixed rate mortgage loan can particularly be a great loan option. However, if you can see yourself selling your home before too long, an ARM mortgage with a small initial rate may be the ideal way to reduce your monthly payments.
Getting Out some Cash
Are you wanting to cash out some of your equity with your refinance? Maybe you need to update your kitchen, take care of your college kid's tuition, or go on a an Alaskan cruise. So you will want to apply for a loan for more than the remaining balance on your present mortgage loan.With this goal, you'll want to find a loan for a higher number than the balance remaining on your existing mortgage. If you've had your current mortgage loan for quite a while and/or have a loan whose interest rate is high, you might\could be able to do this without increasing your monthly payment.
Maybe you want to pull out some of the home equity (cash out) to put toward other debt. If you have the home equity to make it work, paying off other debt with higher interest than the rate on your mortgage (for example: car loans, credit cards, student loans, or home equity loans) means you can save possibly hundreds of dollars in your monthly budget.
Switching to a Shorter Term Loan
Are you planning to fatten up your equity faster, and pay your mortgage off sooner? You should consider refinancing to a short-term loan, often a 15-year mortgage loan. Your mortgage payments will probably be higher than they were with a long-term mortgage loan, but the pay-off is: you will pay considerably less interest and will build up equity quicker. However, if you've had your current 30-year mortgage loan for a number of years and the remaining balance is relatively low, you could be do this without raising your monthly payment — you might even be able to save! To help you determine your options and the many benefits of refinancing, please call us at 630-717-3600. We will help you reach your goals!
Want to know more about refinancing your home? Call us: 630-717-3600.