Reduce your term. Take advantage of low rates to reduce the term of Mortgage loan. Shorter terms mean lower rates.
Convert your adjustable rate into a fixed rate. Adjustable rate mortgage (ARM) loans are a great way to ease into your payments, especially if you are a first time buyer or if you need lower payments initially. Eventually, if you decide you will stay in the home longer, you may want to consider refinancing that into a long term fixed rate loan. Doing so will give you peace of mind, knowing that your rate and payment will not change for a set period of time.
Convert your interest-only loan into a fully-amortized loan.Like ARMs, interest-only mortgage loans are a great way to minimize payments at the beginning; however, because you are not paying any principal, your loan balance does not decrease. If you plan to keep your home long term, you probably want to start paying off your loan. Often, you can refinance your interest-only mortgage loan to a 30-year fixed mortgage loan while keeping your payments about the same.
Remove mortgage insurance.If you purchased a home with less than 20% down, chances are you're paying private mortgage insurance (PMI). Refinancing will help you eliminate the extra expense if you've paid down your balance and/or have seen an increase in your home's value to a point where you have at least 20% equity in, or a loan-to-value (LTV) of 80% or less.
Convert your 30 year loan to a shorter-term loan.Sometimes plans change and the home that you thought you were going to have for a while turns from a permanent situation into a temporary one. If you are planning to sell sooner than you thought and no longer need a long-term rate, then you may consider converting your 30 year fixed to either an ARM or a 3/1, 5/1, or 7/1 loan program, which often have lower rates and payments.
Take cash out to consolidate your debt.Leveraging your equity is one of the smartest ways you can make your money work for you. Use the cash from refinancing to pay off higher interest, non-tax-deductible credit cards, student loans, or medical bills. By consolidating your debts, you can enjoy the benefit of having only one payment each month, and in most cases your overall monthly outflow decreases.
Take cash out for home improvements.What better way to use your hard earned equity than to invest it back with repairs or home improvements? Whether you would like to fix your leaky roof or update your kitchen, you can tap into your equity and have a tax deductible* way to tackle your projects. *consult with your tax advisor.
Take case out to purchase investment property.With current home prices and interest rates low, if you've been thinking about buying a vacation home or an investment property, now may be a great time to tap into the equity on your current home!
Call Gil McLaughlin today at (918) 683-1003