Refinancing is one of the simplest and most effective ways to reduce the interest payments on your home loan. With little to no switching costs or additional charges involved, refinancing enables you to reduce your payment term, lower your monthly payment, or cash in on the equity held in your home, without risking your property.Get Pre-Approved
If you’re not sure what you want to do, here are a few benefits you can attain when you refinance with us:
For homeowners facing higher than market interest rates on their loan, it is a good idea to check out other financing options available. That’s where we come in. Refinancing offers several no-cost and low-cost incentives that can save you interest premiums and high rates. Similarly, short-term loans carry lower interest rates and allow you to pay off your loan in a much shorter amount of time. Refinancing can also help lower your monthly payments, as well as your overall credit period. We advise you to speak with one of our Loan Officers to ensure that your refinance creates a long term benefit for you.
Adjustable Rate Mortgage (ARM) loans allow you to reduce and adjust your mortgage payments, especially when you’re not looking to stay in this home for a long time or if you’re looking for low payments at the onset of your loan. If you eventually decide to become a long-time owner and are not interested in selling, then refinancing allows you to convert that adjustable rate loan into a longer-term fixed loan. This way, you can assure yourself that your interest payment and rate will not change for a defined time period, giving you the peace of mind of a never-changing interest rate.
Interest-only loans work in a manner similar to ARMs. Since you’re only making interest payments without any principal repayments, the initial mortgage payments are very low. In the long run, however, your loan balance is not reduced – since you’re not paying back any of the principal amount. If you want to keep your home for the longer run, you can consider refinancing to convert the interest-only loan into a 30-year fixed rate loan to pay off the principal and gradually reduce your loan liability over that time.
Whenever a home purchase involves a down payment of less than 20%, there is Private Mortgage Insurance (PMI) that comes with it. With the help of refinancing, you can eliminate and reduce the extra expense paid on account of PMI. This is possible if you have paid down your loan balance and/or have witnessed a substantial increase in your home’s value such that at least 20% of your equity is tied up in your home – or a loan-to-value ratio (LTV) of 80% or less – occurs. Depending on your previous loan amount, dropping the PMI could save you hundreds per month!
If you’re planning to sell your home any time soon or simply do not want to take 30 years to pay off your home, you might want to consider refinancing to convert your 30-year fixed loan to a 15 or 20-year term instead, or switch to an adjustable rate mortgage all together. Shorter loan periods like a 15 or 20-year offer lower interest rates, and an ARM offers a lower payment as well as lower interest rates.
Leveraging equity in a home is one of the most preferred ways to use cash to your advantage. The cash saved, in this regard, can be used to pay your credit card bills, medical bills, student loans, and other debts you might have and want to alleviate. Through this process of debt consolidation and cashing out, you can make only one payment every month and decrease your overall monthly outflow. You are using the equity you have built into your home to invest that money or utilize it elsewhere.
With interest rates hitting record-breaking lows this year, there has never been a better time to evaluate all of your refinancing options, including buying a vacation home or investing in another property. Tap into your home equity and down payment options today with us and learn more about how to get the best of refinancing.
Our Loan Officers are here to advise and guide you into making the most important financial descision of your life – buying or refinancing your home. With us you can sit back, relax, and let our professionals handle it. Check out all of our loan options available to see what suits your goals.View All Loan Options
Did you know that in the time it took you to read this page, you could already be pre-approved? Take the first step to getting your new home.
Are you ready to open the doors to your new home, make the right investment, or give yourself newfound freedom by refinancing? Absolute Home Mortgage is ready to guide you every step of the way. Get started with us by clicking the button below. Still have questions? Use the Contact form to the right.Get Pre-Approved
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