5 Reasons You May Want to Refinance

Are trying to find ways to keep a little more of your hard earned money in your pocket each month? If so, refinancing your home might be a good option. According to the Bureau of Economic Analysis the average interest rate in 2012 was 5.098 percent. Nowadays lenders are offering rates much lower than that, therefore refinancing your mortgage is a no-brainer. While saving money is the number one reason many choose to refinance, here are a few other reasons one might refinance their home.

Reason #1: Refinance to get a lower rate and possibly shorten the terms of your loan. If you are paying 5% interest on a 30-year loan but you can get 3.25% interest on a 15-year loan the amount of time it will take to pay off is half of that while only adjusting your payments slightly each month. If it is in your budget to do this than that might be a good reason to refinance.

Reason #2: It will allow you to get out of an adjustable rate mortgage and get into a fixed mortgage. This doesn’t necessarily mean you will get a better rate but your rate will be stable therefore possibly saving you more money over the life of your loan. Because rates are so low, locking in a low rate now will ensure savings as opposed to an ARM  going back up over the next several years.

Reason #3: If you have equity in the home you can take out extra cash to pay down credit card debt, student loan debt, start a business, buy investment property, or anything else you may need the extra funds for.

Reason#4: If you have a second mortgage on the home, or a home equity line of credit, you can use your refinance to combine the two therefore getting rid of the home equity line of credit. Borrowers may do this if they are fearful of rates going up in the future on the equity line.

Reason#5: If you are facing a family issue, ie..Divorce or needing money to help a family member out then refinancing your mortgage can help. A refinance can remove the former spouse from the note.

If you would like more information about refinancing your current mortgage or if  you have additional questions, we would love to hear from you! Call or Click today!