Is it time to refinance? What is your current interest rate? Mortgage rates are close to all time lows! How long they will stay there is another story!! Rates are expected to stay low through 2020, but they may not stay this low.
Look at your current interest rate, depending on where it is, you may want to contact your lender. I have talked to several people lately that had rates in the upper 4% range. Many were able to refinance down to the mid 3% range. Everyone is different but it’s worth looking into. The big question is how long you plan to keep your home. If you are thinking about moving in the next couple years, it may not make sense to spend money to lower your rate.
Another question to ask yourself, do you have an FHA mortgage? Can you refinance to a conventional mortgage and get rid of or lower your mortgage insurance? For many people going to a conventional mortgage will lower and maybe eliminate mortgage insurance. Plus even if you have mortgage insurance now, it will go away on a conventional loan once you have enough equity. FHA mortgage insurance will not go away at any time.
Compare closing costs – make sure you are not paying too much to refinance. For many it may not make sense to pay an origination fee (or points) to lower your rate – depending on how long you are going to be in the home. You want to make sure you recoup your costs before you would sell your home. For some people it may make more sense to raise the rate by .125 or more to lower your closing costs. If you can lower your payment and use the interest rate to lower your closing costs, it may make more sense than rolling them into the mortgage. You may want to bring some money to closing to avoid increasing your loan amount too much.
Are you thinking about remodeling or maybe some home improvements? If you have enough equity in your home, it may be a great time to look into a cash out refinance to take out some equity and use that money for home improvements.
Feel free to call me and talk about your situation! I would love to help you if it makes sense! Refinancing isn’t the best plan for everyone, but it may make sense for you to look into it!
Leslie Vanderwerf, NMLS ID#335509, AMEC Home Loans, An Equal Housing Lender, NMLS#150953 – Email – Website
