Which Refinancing Option is Right for You?
The number of refinance options available to borrowers can be overwhelming. Contact us at 516-431-2009 and we will match you with the refinance program that best fits you. There are some general questions to ask yourself as you consider your options.
Reducing Your Monthly Payments
Are getting lower payments and a better rate your main reasons for refinancing? In that case, a low, fixed rate loan may be the ideal option for you. Maybe you currently have a higher rate fixed rate mortgage, or maybe you hold an ARM — adjustable rate mortgage — in which the interest rate varies. Even when rates come up later, unlike with your ARM, when you qualify for a fixed-rate mortgage, you set the low interest rate for the term of your loan. If you are expecting to live in your home for about five more years, a fixed-rate loan may be a particulary good fit for you. However, if you do see yourself selling your home before too long, an ARM mortgage with a low initial rate could be the best way to lower your monthly payment.
Refinancing to Cash Out
Are you wanting to cash out some of your home equity in your refinance? Maybe you're dreaming of a cruise; you need to pay tuition for your college-bound child; or you are planning some home improvements. With this in mind, you'll need to get a loan for more than the balance remaining on your current mortgage loan.Then you want to find a loan for a higher number than the remaining balance on your existing mortgage. However, if your loan interest rate is currently high and you have held it for quite a few years, you may be able to reach your goals without an increase in your mortgage payment.
Consolidating Your Debt
Do you hold other debt, perhaps with a higher interest rate, that you need to consolidate? If you have the equity in your home for it, paying off other debt with higher interest than the rate on your mortgage (like credit cards, home equity loans, or car loans) means you can possible save hundreds of dollars each month.
Switching to a Shorter Term Loan
Do you plan to build up equity quicker, and pay off your mortgage sooner? If this is your plan, your refinance loan can move you to a mortgage program with a shorter term, like a 15 year loan. Even though your mortgage payment amount will usually be increased, you will save on interest; so your home equity will rise up faster. Conversely, if your existing longer term loan has a small balance remaining, and was closed a number of years ago, you may be able to make the move without paying more each month. To help you figure out your options and the many benefits in refinancing, please contact us at 516-431-2009. We are here for you.