Refinancing means obtaining a new loan against a property you already own, paying off an existing mortgage which has a higher interest rate or longer term, or to borrow for other purposes as you may desire, such as paying off other obligations or financing other purchases or expenses, etc.
Your home is typically the most valuable asset you own and your loan payment your largest monthly obligation. Making sure that you have the best loan possible is an important financial decision.
There are various scenarios where refinancing may make sense and we assist with determining whether refinancing is truly in your best interest and selecting the most appropriate program if so.
By refinancing your mortgage loan when interest rates are lower than that of your current loan, you can lower your monthly payment and potentially save thousands in loan interest over time. Whether this is truly in your best interest will also depend on costs involved, your anticipated time to remain in the home and other factors. Your loan originator will work with you to understand your needs and goals and help you determine what's best for you.
Note: The consumer's total finance charges may be higher over the life of the loan.
Another alternative for refinancing your mortgage loan may be perhaps to shorten your loan term. When rates are lower than that of your current loan, a new loan with a shorter term may have a minimal affect on your monthly payment, potentially save thousands in loan interest over time and allow you to build equity in your home more quickly as you’re paying it down and off sooner.
Another potential reason for refinancing your home might be to utilize equity in your home to consolidate other debt, make other major purchases or investments, or other personal uses. This can be a wise approach but also increases the debt against your home and your monthly payment and the time required to pay off your home, if this is your goal. We can assist you in analyzing what is in your best interest and in selecting the most appropriate loan for your situation.