RECORD HIGH REFINANCES
Refinance applications have surged to decade highs over the last few months and rightfully so. According to Freddie Mac’s Primary Mortgage Market Survey, average mortgage rates have also set new all-time lows within the same period and many home owners are hoping to take advantage of these lower rates. So what are the benefits of refinancing and should you start the process now? Read more to find out!
BENEFITS OF REFINANCING
There are multiple benefits to refinancing your mortgage. We’ll dive into some of them below:
- Lowering your interest rate. If you qualify for a new mortgage, lowering your interest rate will reduce the overall interest charged on the loan and can save you thousands of dollars over the life of the loan.
- Eliminate mortgage insurance. If your current mortgage includes mortgage insurance, and you have 20% equity in your home’s current value, you can refinance to remove the mortgage insurance and potentially save hundreds off your monthly mortgage payment.
- Cashing out your equity. On a cash-out refinance, lenders will generally limit you to borrowing no more than 80% of your home’s value to ensure you maintain 20% equity in the home. You can use the cash from the refinance to fund home improvements or consolidate high interest debt.
- Shorten your mortgage term. Pay off your home quicker by refinancing into a shorter term length. A 15-year term mortgage typically offers lower rates compared to a 30-year term, so your monthly payment might not increase by much.
IS IT THE RIGHT TIME FOR YOU?
There are many things to consider before refinancing such as how long you plan to remain in the home and if the potential savings make sense when compared with the associated closing costs. Contact us today to schedule a free consultation where you’ll work with one of our highly experienced and knowledgeable loan advisors!