What You Need to Know About Refinancing Your Home
For most families, paying the mortgage each month is a top priority. Depending on when you purchased your home, you may be locked into an interest rate or monthly payment structure that’s much higher than today’s competitive rates. In other situations, life circumstances may have forced you to take out a second mortgage or put you in a position where you’re looking at options to lower your payments. Sometimes, fortunate events such as a big raise have you thinking about paying off your loan ahead of schedule. Whatever your circumstances, refinancing your mortgage can be a smart step. Here are some aspects to discuss with a qualified lender.
Can you lower your interest rate?
Interest rates fluctuate over time, and can add hundreds of dollars each month to your mortgage payment. If today’s rates are lower than what you’re paying, it may be time to consider a refinance. Discuss your interest rate, points, and current payment with a lender to learn whether you can qualify for a better rate. Reducing your interest rate can lower your monthly payment, increase the speed at which you can pay off your loan, and reduce the amount of interest you pay off over the life of your mortgage.
Could refinancing reduce your overall monthly expenses?
Refinancing a home loan can reduce your monthly expenses in a couple of ways. One way is by decreasing your interest rate and mortgage payment. For many families, the mortgage is their largest single expense each month. In other cases, if you have installment debt such as credit cards or personal loans, your total monthly payments can vary widely based on interest rates. Refinancing your home may allow you to tap into your existing equity and withdraw the cash needed to pay off your other debts. By consolidating, you can simplify your financial life and get on the road to better financial health.
Could refinancing allow you to pay off your mortgage faster?
Many home owners consider refinancing simply for the reason that they want to own their home outright as soon as possible. The financial freedom that comes with paying off your mortgage is substantial. Sometimes this is accomplished by lowering interest rates, which enable more money each month to be applied toward the principal. In other cases, it’s about changing the type of financing vehicle from one form to another such as an ARM to a fixed rate mortgage. Another option is to change a 30-year mortgage to a 15- or 20-year one. The ability to anticipate and accelerate your payment schedule is often the key to paying off your loan faster.
Are you in the Las Vegas area and considering refinancing your home? Contact Sydnee Johnson to arrange for a personalized consultation to discuss your unique situation, goals, and learn more about how refinancing can help you today.