22
Mar
By First Rate Financial Group
Mortgage

Can I Pay My Home Loan Off Early If I Refinance?

Can I Pay My Home Loan Off Early If I Refinance?Many people are looking for opportunities to save money on the cost of a mortgage. If you want to save money on your home loan, you might be thinking about refinancing. During the refinance process, you will replace your current home loan with a new mortgage. Some people want to refinance their homes to free up cash for a renovation project, while other people want to pay off their homes sooner. How can you pay off your home loan early through a refinance?

Reduce Your Interest Rate 

During the refinance process, you might qualify for a lower interest rate. There are numerous reasons why you might get a lower interest rate when you refinance your mortgage. The average interest rate may have come down, your credit score may have improved, or your debt to income ratio may have gotten better. If you were due to your interest rate, more of your monthly payment will go towards the principal, shrinking your balance faster. As a result, you may pay off your mortgage more quickly. 

Reduce The Term of the Loan 

If you refinance your home, you might be able to reduce the term of the loan. The term is how many years it takes you to pay off your mortgage. For example, you may be able to reduce your 30-year mortgage to a 15-year mortgage. If you shorten the term of your loan, you may qualify for a lower interest rate, which can help you save money; however, directly shortening the term of the loan could cause your monthly payments to go up. You could work with a professional who can help you with the math. That way, you understand exactly how much you owe every month. 

Consider Paying Off Your Mortgage More Quickly

If you want to save money on interest during the life of your loan, one way to do so is to pay off your mortgage faster. You might be able to do this if you refinance your home loan. Reach out to a professional who can take a look at the balance of your home loan. You might qualify for a refinance that can help you save money on your mortgage. 

15
Mar
By First Rate Financial Group
Mortgage

What Are The Top Signs You Need To Refinance?

What Are The Top Signs You Need To Refinance?You might have heard that more people are refinancing these days. During the refinancing process, you essentially take your current home loan and replace it with a different one. You can reduce your mortgage payments, shorten the life of your loan, or withdraw cash you can use for other purposes. What are a few of the signs that indicate you should consider refinancing? 

You Can Secure A Lower Interest Rate

If you think you can secure a lower interest rate on your mortgage, it might be time to refinance. There are a number of reasons why you might be able to get a lower interest rate on your home loan. Your credit score may have improved, you may have paid off some of your other loans (which will improve your debt to income ratio), or the average home loan interest rate may have dropped. If you can get a lower interest rate on your home loan, you may want to refinance and save money. 

Your Income Has Increased Significantly

If your income has gone up significantly since you purchased your house, you might want to pay off your house more quickly. Therefore, you might want to refinance and use larger payments to pay down your home loan more quickly. The bank might also give you better terms if you are willing to make larger payments.

You Are Concerned About Your ARM Mortgage

If you have an adjustable-rate mortgage (ARM), you might be concerned that the interest rate on that mortgage could go up. Therefore, you can refinance your home and convert your ARM mortgage to a fixed-rate mortgage. If you can lock in an interest rate with a fixed-rate mortgage, you do not have to worry about your interest rate increasing in the future. This could save you thousands of dollars over the life of the loan. 

Consider Refinancing Your Home

These are just a few of the signs that you should consider refinancing your mortgage. Everyone is in a slightly different financial situation, so you should work with a professional who can figure out if this is right for you. That way, you can secure the best possible terms for your home loan. 

11
Mar
By First Rate Financial Group
Mortgage

How Can A Cash-Out Refinance Help You?

How Can A Cash-Out Refinance Help You?If you have been in your home for a while, you might be able to refinance. If your credit score has increased, your income has gone up, or the average home loan interest rate has gone down, you might be able to conduct a cash-out refinance. During this process, you can keep your mortgage payments the same, secure a lower interest rate, and withdraw the difference as cash. What can you do with this extra cash? 

You Can Make Improvements To Your Home

One of the most popular ways people use a cash-out refinance is to increase the value of their homes. For example, you may want to use the money from a refinance to upgrade the kitchen. Or, you might want to use a cash-out refinance to add an addition to your home. You can also use the proceeds from a refinance to handle expensive home repairs. If you want to increase the value of your home, you can tap into the equity in your home through a cash-out refinance.

You Can Pay Off Student Loans

Another popular way to use a cash-out refinance is to pay off existing debt. For example, you can use the cash from this refinance to pay off a car loan, credit card debt, or student loans. Some people have hundreds of thousands of dollars in student loans, and it can take decades to pay them off. If your mortgage has a lower interest rate than your student loans, you may want to use a cash-out refinance to pay off your student loans. 

You Can Pay Expensive Medical Bills

Finally, you can also use a cash-out refinance to cover emergency expenses. If you have expensive medical bills, you might want to use a cash-out refinance to cover these costs. A cash-out refinance can help you in a pinch. 

Consider A Cash-Out Refinance For Your Home

These are just a few of the many ways you might be able to use a cash-out refinance to help you. If you are interested in refinancing your home loan, you should work with a professional who can point you in the right direction. You can secure the best terms possible, withdraw the maximum amount of cash, and ensure you still pay off your mortgage on time.