What To Do After Refinancing Your Mortgage

Did you just complete the mortgage refinance process and are excited about your new savings? While it’s exciting to lower your monthly payment and have some extra cash, it’s important to use that extra money wisely so it will benefit you in the future. Below are some money-savvy options for putting this extra cash to good use.

1. Establish or enhance your emergency finance fund. If your income is interrupted or if an opportunity or need arises, your emergency fund lets you avoid interest costs from borrowing or tax consequences from cashing out investments.
2. Pay down credit card debt. Paying off high rate credit cards or other debts will free up your finances so you can invest it for the future.
3. Invest, Invest, Invest. Max out your 401K contribution. Even a partial match from your employer yields an amazing, instant rate of return. Got kids? Start or ramp up a college savings plan. Tuition costs are rising faster than inflation. Invest now to help beat the trend.
4. Make sure you are protected. Do you have sufficient life, disability and property insurance? Doing everything else right matters little if tragedy strikes and you lose it all due to lack of coverage. Double check you’re covered before anything happens.
5. Pay off your loan faster. This is not always the best thing to do with your cash (see numbers 1, 2, 3 and 4), but for some, peace of mind has the best rate of return.

Here’s another thing to think about. How about buying your vacation/retirement home today? Finance your payments by renting it out when you aren’t there. Then, when you do retire, you will have already built memories in your new home, and you will be well on your way to paying it off. Plus, when you sell your main residence later, the proceeds can fund living expenses. This is not for everyone, but at today’s low rates, it may make sense for some.

First Ohio Home Finance, Inc. can assist in the evaluation process to determine if refinancing is the right move for you. Throughout the entire loan process, our mortgage bankers will help by offering a customized program to meet your financial requirements and by providing the individualized attention you deserve. Contact us today to learn more!