Refinancing a home can be very beneficial but may not always be the best thing to do. If you answer yes to anyone of these questions then refinancing your home may be a good thing.
1. Can you lower your interest rate?
If you can reduce your interest rate by at least 1 percentage lower than your current interest rate, you could save hundreds or even thousands of dollars on mortgage interest.
2. Has your credit score improved?
If you have made your long term debt payments on time including mortgage, auto, credit cards, etc. and lowered your debt-to-income ratio chances are your credit score has improved. A higher credit score may help lower your interest rate compared to what you have now.
3. Can you shorten your loan term?
Most people get a 30-year fixed-rate mortgage, but after a few years you may find refinancing to a 15-year fixed-rate mortgage will keep your monthly payments around the same thus paying it off faster with less interest.
4. Do you have an adjustable-rate mortgage?
Most adjustable-rate mortgages tend to fluctuate or cap out at a much higher rate that the current interest rate. Refinancing to a fixed rate mortgage may save you thousands in interest and lower your monthly payment all at the same time.
5. Could you use some money to pay off debt, make improvements to your home or send your kids to college?
As home values continue to rise, many homeowners now have enough equity to do a cash-out refinance or get a Home Equity Line of Credit (HELOC).
If you would like more information about refinancing, buying or selling, call #MikeCusimano with #PremiereTeamRealEstate at 512-689-9955.