Extend the term of your Mortgage
If your house has a thirty-year mortgage, that is a good amount of time to consider refinancing your home, as with a fifteen-year mortgage, the home is not that expensive as opposed to a thirty-year loan mortgage that you are paying for.
If the mortgage you have right now is short term, you can make the decision to extend the mortgage to higher rates such as 20, 25 or 30, which will lower your monthly payments overall and provide you will financial stability for a period of time. Also if your current monthly payments are too much, this can be a great option to provide you with more time.
A good starting point is to use a mortgage calculator to insert your information and see what the new payment would be. If you find along the way that the new payment is in line your expectations, you may want to contact a mortgage adviser to seek further information and expend the loan.
Lower Interest Rate
Because interest rates are low now than ever, it is a good move to refinance your home now. At the moment for thirty year fixed loans, 1 year introductory rates are low and adjustable in mortgage rates since 1992.
Thirty year mortgages rates are now quite low at 3% and fifteen year loans are even lower. If your home is showing to be financed at an increase interest rate you may want to refinance as you could be saving a lot of money by doing the necessary paperwork.
When refinancing your mortgage loan at a lower interest rate you can significantly reduce the payment and save money in interest. Also lowering your mortgage payment can save hundreds of dollars per month, which you could put into your savings account. Refinancing will lower your payment but will also increase the loan term.
One of the benefits of refinancing is that you are able to merge a second mortgage or even a home equity loan along with your home mortgage; this can save you a lot of money, as you would be paying lower rates on the ultimate amount, rather than a low percentage rate on just a mortgage loan.
Another benefit of refinancing a loan is that you can easily have access to cash that you can use to save for the future. The cash can be used to pay off debts or to invest in something you have always wanted to invest in. With the cash, you’re able to increase your overall financial situations and be more flexible in the way you use your cash in the future.
Adjustable Rate to a Fixed One
If you refinanced now, you would have more stability in the long term as you can transfer your adjustable rate to a fixed one. With a fixed rate loan you will find there is less hassle and it is easier to plan ahead and make decisions that are important to you financially. Fixed loans also present no drawbacks to you in the long term and provides you with stability in the future.