Reasons to Consider Refinancing Your Mortgage
If you would like to reduce your monthly payments or shorten the duration of your home loan, talk to a Certainty Home Loans mortgage professional to evaluate your mortgage refinance options and find the best possible solution for your short and long-term financial goals.
How Refinancing Works
- Reduce the term of your mortgage and pay your home off sooner.
- Switch from an adjustable rate mortgage (ARM) to a fixed rate mortgage to give yourself a fixed monthly payment.
- Combine your first and second mortgage into one home loan, with one monthly payment.
- Eliminate mortgage insurance
- Obtain investment property capital
- Fund a retirement account
- Establish a college fund for your children / grandchildren
- Remodel or renovate your current home
It’s simple. You pay off your original mortgage and replace it with a new one. However, your new interest rate and terms may be different, and the total finance charges may be higher over the life of the loan, even though the property is the same. And that can make all the difference in the world. The good thing is that since you already own the property, it may be easier to finance than it was when you originally bought the house. Plus, you may now have equity which could also make things easier for you.
Refinancing Can Save you Money in a Number of Ways
- Lower interest rates equals a lower monthly payment, if you refinance for the same amount as your current mortgage balance
- The amount you pay toward principal will go up if the term of your new mortgage matches how many years remained on your original mortgage
- If you have more than 20% equity in your house, you can eliminate private mortgage insurance (PMI)