Is mortgage refinancing right for you?
If you have been living in your Duluth home for a while, it might be the right time to consider refinancing your mortgage. There are many good reasons to consider refinancing, including lowering your interest rate, consolidating your bills, shortening your loan term, switching from an adjustable mortgage to a fixed rate mortgage or taking advantage of your home's equity via a Duluth home equity loan.
Rate Reduction
Generally, if your closing expenses can be recovered within the first 30 months of the new loan, mortgage refinancing is probably a good idea. For your Duluth home loan
Loan Term Reduction
There are several advantages to reducing the term of your existing Duluth mortgage loan. Although you may experience slightly higher monthly payments on your new mortgage, a loan term reduction due to mortgage refinancing often translates into a significant reduction in interest costs, as well as a more rapid build-up of equity in your Duluth home.
Switching From an Adjustable Rate Mortgage to a Fixed Rate Mortgage, or to a New ARM?
You may have an adjustable rate mortgage (ARM) you're not entirely satisfied with. Maybe the rate is higher than you like, or the potential for rate increases looms ahead. If you plan on staying in your Duluth home at least five years, now might be an excellent time to switch to the payment security of a fixed-rate loan. Or, if you plan on moving from Duluth in less than three years, consider refinancing to a new Duluth Adjustable Rate Mortgage to take advantage of the low starting rates that may be available. Even if the new adjustable mortgage rate rises at the first adjustment interval, the starting rate may be low enough to offset any increased payment costs.
Mortgage Consolidation
If you are carrying a first and second mortgage on your Duluth home, and want to combine the two loans into one favorable rate, mortgage refinance might be for you.
Tax-free Cash Via Equity
Many borrowers have built up significant Duluth home equity over the years through appreciation and principal reduction. These borrowers may refinance an existing mortgage to a larger loan amount, with the additional funds used for any purpose - investment, car, tuition, debt consolidation, Duluth real estate, etc. And, unlike any other consumer loan, the interest paid on the "cash out" could be 100% tax deductible! (Consult your tax advisor.)
Balloon Payment Due
If you have a balloon mortgage with a lump sum payment due in the near future, consider refinancing if you are comfortable with the current rate environment.
Things to Think About
Find Out the Facts First
If you are thinking about mortgage refinancing, but aren't sure whether it will really save you money, it may well be worth speaking to one of American Brokerage’s mortgage professionals who can help you calculate how much your new monthly mortgage payments will be, as well as the cost of your refinance.
Going Through the Process
When refinancing your home, American Brokerage will need many of the same documents you supplied for closing your Duluth home. A new credit check, title search and insurance, an appraisal are usually required for your Duluth home loan. Depending on the mortgage loan program you select, you may also be charged loan origination fees and, perhaps, points.
As Duluth mortgage interest rates begin to drop, many Duluth homeowners' thoughts turn to mortgage refinancing. And with good reason! When your existing mortgage is replaced with one that has a low rate, you benefit from lower monthly mortgage payments.
Call our team of Duluth specialists toll free 800-874-8760 or apply online today!
