How do you know when it’s the right time to refinance your mortgage? For most people, the best time to consider refinancing is if:
- You want a lower monthly payment
- You’d like a shorter term
- You’d like to make home repairs, consolidate your debt, or take cash out
Lower monthly payment
If current mortgage rates are lower now than when you bought your home—it’s time to refinance. You can lower your monthly payment simply by refinancing the remaining balance for the same loan term or lower it even further by refinancing for a longer term. Better yet, if you’re still paying Private Mortgage Insurance (PMI) a refinance may put you in a position to have that removed. Even a quarter of a percent can mean the difference of thousands of dollars in interest for the life of the loan. Curious how much you can save? Take our mortgage refinance calculator for a spin.
Shorter loan terms often receive better rates. As a result, refinancing your 30-year mortgage for a 15-year mortgage could save you thousands in interest on your loan. So even if your payment increases, you’re paying less in the long run and you’re paying it down even faster.
Home repairs & debt consolidation
Avoid high interest rate credit cards and use your homes equity. With something like a cash-out refinance, you can choose a shorter term, you may be able to remove PMI, and get the cash you need to make home repairs or pay off your other debt.
Still not sure? Let us figure it out for you!
Schedule a no cost, no obligation consultation with one of our home loan experts and we’ll get you started in the right direction.