A common rule of thumb is if today’s mortgage rates are lower than your original rate by 1% or more, it might be a good idea to explore refinancing. So, let’s talk about the 5 ways you may be able to save some serious cash with a refi.
#1 – LOWER YOUR RATE. When people think about refinancing, it’s usually to cash in on a lower interest rate, which can save you thousands in interest over the life of your loan. Rates are still low, so if you’ve been on the fence about a refi, now would be a really good time to explore that opportunity.
#2 – LOWER YOUR TERM. If you have a 30-year mortgage and refinance to a 15-year, you’re not only paying your mortgage off quicker, but you’re paying way less in interest over the life of your loan.
#3 – GET CASH. If you’ve built up equity in your home, it’s money that’s just chillin’ there. If you have high-interest debts – credit cards, medical bills, student loans, etc. — you can cash out that equity, pay off those debts, and then roll them into your mortgage payment, which will have a considerably lower interest rate. Bonus: Interest on a mortgage is tax-deductible; interest on credit card debt is definitely not. Of course, always consult your tax advisor regarding your specific situation. And bonus number two – Once you’ve consolidated all that high-interest debt into your mortgage, you will have essentially paid it all off, thus, giving your credit score a boost.
#4 – DROP PMI. If you have an FHA loan and are paying mortgage insurance every month, you can refi to a Conventional loan and get rid of that mortgage insurance. And if you’re paying mortgage insurance, you know what kind of savings that is.
#5 – SKIP A PAYMENT. And we may be able to time your refinance so that you can go up to two months before making your next mortgage payment.
Of course, savings will vary based on your situation, but it never hurts to explore your options. Give your Homespire Loan Officer a call. We’ll run the numbers to see if it makes good financial sense for you to refinance right now. We just want to help you save some money.
Visit https://www.homespiremortgage.com/loan-officer-search/ to find a Homespire Loan Officer near you.