Refinancing: Which Loan Program is for You?
Even though it seems like it at times, there are not as many refinance loan options as there are applicants! We can guide you to select the refinance program that will fit your needs the best. Call us at 714-970-9700 to get things started. There are some general questions to ask yourself as you look at your choices.
Lowering Your Payments
Are achieving reduced payments and a lower rate your main refinance goals? In that case, the best choice might be a low fixed-rate loan. Maybe you are now in a loan with a high, fixed interest rate, or a loan with which the rate of interest varies - an adjustable rate mortgage (ARM). Even when rates get higher later, unlike with your ARM, when you close a fixed rate mortgage, you set that low interest rate for the term of your mortgage. If you are not planning on moving in the near future (about 5 years), a fixed rate mortgage loan can especially be a wise loan option. However, an ARM with a low intitial payment may be a wiser way to lower your monthly payments if you expect to move in the next few years.
Getting Out some Cash
Are you wanting to cash out some of your equity in your refinance? Maybe you need to make home improvements, take care of your college kid's tuition, or take your family on a dream vacation. In this case, you'll want to find a loan for more than the remaining balance of your existing mortgage loan.With this goal, you'll You will need to apply for a loan for more than the remaining balance with your current home loan in this case. However, if your mortgage rate is currently high and you have held it for quite a few years, you could be able to achieve your goals without making your monthly payments bigger.
Consolidating Debt
Maybe you want to cash out some home equity (cash out) to put toward other debt. If you have some debt with higher interest (like credit cards or car loans), you might be able to pay that debt off with a loan with a lower rate through your refinance, if you have enough home equity.
Getting a Shorter Term Loan
Do you need to build up equity more quickly, and pay off your mortgage more quickly? You should consider refinancing to a shorterterm loan, often a 15-year mortgage loan. Your mortgage payments will likely be more than they were with the long-term loan, but in exchange, you will pay quite a bit less interest and can build up equity quicker. But, you may be able to make the change without a higher monthly payment if your long term loan was closed a while back, and the remaining balance is somewhat low. You may even make it lower! To help you determine your options and the numerous benefits in refinancing, please call us at 714-970-9700. We would love to help you reach your goals!
Want to know more about refinancing your home? Give us a call: 714-970-9700.