Your Home Loan Refinance Needs to Make Sense

The key to making the decision to doing a  refinance home loan depends on your overall financial situation and why you are wanting to refinance. If it is to lower your home loan interest rate, rule of thumb is that if the home refinance lowers your current rate at least 1%, it is a good financial decision. Keep in mind it will also depend on how long it takes you to recoup your cost. You should also take into consideration how long you have left on your current home mortgage.  A mortgage refinance can also be the best option when it comes to debt consolidation. Typically home refinance rates are going to be lower than debt consolidation loans.

Most likely you are considering a home loan refinance to save money either in your mortgage monthly payment, your total monthly payments or in the cost of your home loan by shortening the term or lowering your interest rate.  

That is where we come in....One of our experienced mortgage advisors can lay out all your options for you, assisting you to make the best choice for you and your goals. 

Sometimes it makes a lot of financial sense to use the equity of your home to pay for certain expenses. 

Your home is a big part of your overall financial portfolio, therefore it is best to use home equity to finance expenses that will better you financially.  Like home improvements that will increase the resale value,  replenishing your savings, or to purchase another property for investment. 

Retired homeowners who have paid down their mortgage can sell their home and cash out the equity by downsizing. Further, homeowners 62 and older have the option of reverse mortgages; this allows the retiree to use the equity in their home to eliminate their monthly house payment and in some cases even give the homeowner monthy income which can help pay for needed care. 

It is not a good idea to use home equity to purchase unnecessary luxury items, such as a boat, expensive cars or a vacation. These are depreciating assets and you will be paying for them over many years if you use a home refinance to purchase them. 

There is no legal limit to how many times you can refinance your home.

The refinancing process is typically much simpler than when purchasing a home. The first step of this process is to review what mortgage refinance rates and programs are available with a loan expert. Once you have determined if a refinance home loan is a good option for you, the next step will be to complete your application and collect some simple documentation. 

Once your home loan application has been approved and you have signed your new loan documents, your new mortgage will pay off your existing mortgage. 

Many lenders offer what's called a "no closing cost" or "zero closing cost" mortgage.

With these mortgages, you don't have to pay cash at closing for any of the fees and charges you'd normally pay. However, you usually pay for them in one of two ways:

1. Your lender covers the cost, but charges you a higher mortgage rate.

2. The closing cost will be rolled into the mortgage itself, increasing the total balance. 

The trade-off wth zero-closing cost loans is that you save money upfront but end up paying more in the long run. 

Many lenders will publish interest rates that look great until you read between the lines. 

We prefer you reach out to us for a quote regarding home refinance rates because there are so many variables that determine what your mortgage rate will be. For example, your credit score, what the LTV will be, your DTI, what loan type you are wanting and in some cases the type of property, like a manufactured home will typically increase the interest rate. Because we are a direct mortgage lender that has earned the trust of over 30 nationwide banks and investors, we can offer our borrowers competitive mortgage rates. We are also committed to building a foundation of trust with our borrowers over the years by being honest and treating each transaction with integrity and superior service.

Reach out to us today and we will be happy to share with you what mortgage rates are currently available and what home loan programs might best serve your needs.