Have you thought about refinancing but aren’t sure if its for you? Here are 5 reasons why you should refinance today!
1. Lower Your Monthly Payment
The most popular reason for borrowers to refinance is to lower their monthly payments. The interest rate on your mortgage is linked with how much your monthly payment will be. The lower your interest rate, the lower the monthly payment. Refinancing allows you to get a better interest rate so you can save more money.
2. Pay Your Mortgage Off Faster
Another advantage of refinancing is you can adjust the length of your mortgage. Making your loan term shorter will allow you to pay off your mortgage faster and this will help you save money that would go towards interest. The only disadvantage to this is larger monthly payments.
3. Switch from an Adjustable Rate Mortgage to a Fixed Rate
With adjustable rate mortgages your rate will increase or decrease based on current interest rates. If you find yourself worried about increasing payments due to increasing interest rates, a fixed rate mortgage can be a good solution. Refinancing your loan to a fixed mortgage allows you to have more peace of mind because you know your payment will always be the same.
4. Take Control of Your Finances
Are you overwhelmed with debt? Use money from your mortgage to pay off bills and consolidate your debt. Paying off high interest credit cards can help improve your credit score and create a better financial situation for you and your family. A well planned mortgage can help you re-balance your debt and get you on your feet financially.
5. Take Cash Out of Your Home
Use your home equity to your advantage. Refinancing can give you a chance to leverage your home equity to enhance other aspects of your life such as: increase the value of your home with renovations, pay for college tuition or buy a vacation home.