Refinancing: Which Loan Program is for You?

The huge number of refinance options available to borrowers is truly breathtaking. Contact us at 714-970-9700 and we can help you qualify for the perfect loan program for your financial situation. What do you hope to achieve with your refinance loan? Considering in mind the information below will help you begin your decision process.

Making Your Payments Lower

Are your refinance goals to lower your rate and consequently your mortgage payments? In that case, a low, fixed rate loan may be the best choice for you. Perhaps you currently have a higher rate fixed rate mortgage, or perhaps you have an ARM — adjustable rate mortgage — in which the interest rate varies. Different that the ARM, your low fixed rate mortgage stays at a certain low rate for the term of your mortgage loan, even if interest rates rise. If you are not planning a move in the near future (about 5 years), a fixed rate mortgage loan can especially be a good loan option. But if you do expect to sell your home more quickly, you should consider an ARM with a low initial rate to get reduced payments.

Cashing Out

Is your refinance goal primarily to pull out some home equity for an infusion of cash? Perhaps you're going on a much needed vacation; you need to pay tuition for your college-bound child; or you plan to renovate your home. With this in mind, you want to look for a loan for more than the remaining balance on your current mortgage loan.Then you will want to find a loan for a higher amount than the remaining balance on your current mortgage. However, if your loan interest rate is high now and you have held it for quite a few years, you could be able to accomplish your goals without an increase in your mortgage payment.

Consolidating Debt

Do you want to pull out some of your equity to consolidate additional debt? Great idea! If you have enough home equity, paying toward other debt with higher interest rates that your home loan (credit cards or home equity loans, for example) may be able to save you a lot of money each month.

Building up Equity Faster

Are you wanting to fatten your equity faster, and get your mortgage paid off sooner? If this is your goal, the refinance can change you to a loan program with a short, such as a 15 year loan. You will be paying less interest and increasing your equity more quickly, although your monthly payments will generally be more than they were. On the other hand, if your current longer term mortgage loan has a small balance remaining, and was closed a number of years ago, you might be able to make the move without paying more each month. To help you determine your options and the many benefits of refinancing, please contact us at 714-970-9700. We are here for you.

Curious about refinancing? Call us at 714-970-9700.

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