As the economy changes and your home value adjusts here are some considerations to help you decide if the time is right to refinance your property.
Rates are lower, should we refinance?
If the interest rate is lower than your current rate and you are saving monthly on your payment then it might be a good decision. When making this decision look at your long term goals to ensure it makes financial sense. By taking the amount you pay in closing costs (not to include your prepaid interest, taxes or insurance) and divide this number by your projected savings per month, this will give you the time it will take to recoup these costs. From there you can determine whether or not to move forward.
There are many options available. The fees associated with refinancing your mortgage can be negotiated with the institution you decide to work with.
Can my closing costs be financed?
When refinancing, you have the option to include the closing cost in your new loan if there is enough equity.
Is an appraisal necessary when I refinance?
Yes, unless you are doing an FHA streamline refinance (for existing FHA mortgage holders only, FHA does not require an appraisal)
What is the difference between a Fixed Rate and ARM (Adjustable Rate Mortgage)?
A fixed rate mortgage will be for a term of 10, 15, 20, 30 or 40 years and the interest rates stay the same throughout the term of the loan. An adjustable rate mortgage (ARM) means that after a fixed term of 1, 3, 5, 7or 10 years, your interest rate can change according to the terms of your note.
What is an Interest Only Loan?
This type of loan is fixed for a specified term (ARM) and you are only required to pay the interest only portion of the payment. This will usually reduce the monthly payment significantly. You also have the option to pay additional monies towards the principal of the loan.
What is Cash out Refinance?
If you have enough equity in your property, you may be eligible to refinance with a loan amount greater than your existing mortgage. You can use this money for home improvement, debt consolidation, college tuition or other areas that this money may be needed.
A HomeValue Fax Report provides price prediction, range depending on variances in location, view, quality & condition, sale trends & market data influencing the potential appraisal of your home helping you determine your equity, loan and program options, saving you time, money, frustration and disappointment.
For more information on Home Values please visit http//www.homevaluefax.com or http://homevaluefax.com/homeowner.html
