Refinancing: Which Loan Program is for You?

There aren't as many loan program choices as there are applicants, but at times it feels like it! Call us at (714) 827-5125 and we will match you with the refinance program that best fits you. In the interest of looking at your choices, you can think about your goals for your refinance.

Making Your Payments Lower

Are your refinance goals to lower your rate and consequently your mortgage payments? If so, your best option could be a low fixed-rate loan. An ARM (Adjustable Rate Mortgage) or a high fixed rate mortgage are loans that you might want to refinance. Even when rates come up later, unlike with your ARM, when you qualify for a fixed rate mortgage, you lock in the low rate for the life of your loan. If you aren't planning a move in the near future (about 5 years), a fixed-rate mortgage can particularly be a great option. However, if you can see yourself selling your home within the next few years, an ARM mortgage with a small initial rate could be the best way to lower your monthly payments.

Getting Out some Cash

Are you refinancing primarily to "cash out" some home equity? Your home needs new carpet; your daughter has gone to University and needs tuition; or you have a special family vacation planned. With this in mind, you need to get a loan for more than the remaining balance of your existing mortgage.With this goal, you'll You will want to qualify for a loan for more than the remaining balance on your current home loan in this case. If you've had your current mortgage for a number of years and/or have a loan with high interest, you might\could be able to do this without increasing your mortgage payment.

Consolidating Debt

Do you want to pull out some of your equity to consolidate additional debt? Excellent idea! If you have some higher interest debts (like credit cards or car loans), you might be able to take care of that debt with a lower rate loan through your refinance, if you have enough home equity.

Switching to a Shorter Term Loan

Are you hoping to fatten your home equity faster, and pay your mortgage off sooner? In that case, you want to look into refinancing to a short term mortgage - for example, a fifteen-year mortgage program. The payments will likely be higher than with a longer term loan, but in exchange, that you will pay considerably less interest and can build up equity quicker. But, you might be able to make the change without much increase in your monthly payment if your long term loan was closed a while ago, and the remaining balance is low. You may even make it lower! To help you figure out your options and the many benefits of refinancing, please contact us at (714) 827-5125. We are here for you.