3 Reasons You May Want To Consider Refinancing Your Mortgage
Posted on: 11 January 2020
Is it about time for your home mortgage to be refinanced? There are many factors that go into making the decision whether it is time to refinance your home mortgage. Here are just a few of the reasons why you may be considering talking to a mortgage programs specialist about refinancing your existing mortgage.
Decrease the Length of Your Current Home Mortgage
If your current home mortgage is a 30-year fixed mortgage, then you may want to consider refinancing to a 15-year fixed-rate mortgage, as this can save tens of thousands of dollars and possibly even more down the road. When compared to long-term home loans, interest rates tend to be significantly lower for short-term home loans. In addition, the overall amount of interest that you pay will be less, though you can expect to pay a larger payment per month due to the shorter loan term.
Increase the Length of Your Existing Home Mortgage
If your existing mortgage is on a 15-year note and your payment has gotten a little out of hand, then you may be interested in trying to increase the length of your mortgage so that your monthly payment is lowered. This will allow you to use the money that you save on your monthly payment in a number of different ways, such as increasing your contributions to your 401(k) plan or IRA or building a college fund for your child. In addition, when tax time rolls around, you can reap the benefits of being able to have an increased interest deduction.
Lower the Interest Rate of Your Current Home Mortgage
Another reason that you may want to refinance your home mortgage is so that you can get a better interest rate. In many cases, if your credit score has improved since you took out your mortgage, it may be possible to get a lower interest rate than what you have on your existing home mortgage, as long as interest rates today are lower. Refinancing can help you get short- and/or long-term benefits like lower monthly payments and cash out.
When it comes to all of the home mortgage refinancing options, things can get pretty overwhelming and complex. For that reason, it is a good idea to talk to a professional who can help you navigate all of the choices that are available to you. A professional can help you determine the program that is best for your individual needs and goals.
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