If you're looking for a way to make extra cash quickly, you've probably considered refinancing your home. Even though interest rates are quite low, there are some advantages to refinancing your home loan.If you're looking for a way to make extra cash quickly, you've probably considered refinancing your home. Even though interest rates are quite low, there are some advantages to refinancing your home loan.
Here are six of them.
The best thing about refinancing is that you can get a lower rate. The worst thing about refinancing is that you have to refinance. Let's say that you have a $300,000 house with a 10% interest rate and you decide to refinance to get a 15% rate. Your monthly payment will decrease from $2,100 to $1,650. However, you'll have to make a fresh $300,000 payment at the end of the year, plus another $300,000 in two years. So, in the end, you'll actually end up paying more money.
The best thing about a cash-out refi is that you can get cash now. The worst thing about a cash-out refi is that you have to refinance. Let's say that you have a $300,000 house and you decide to refinance to get a 15% rate. When you do this, the bank will give you a check for the current value of your home at the time of borrowing (this is called the "base payment"). So, in this case, you'll get $300,000 for your home, without having to make any other payment. In two years, you'll have to come back and make a fresh $300,000 payment plus another $300,000 in three years. That's a total of $600,000 that you have to come back and pay. It's also important to mention that if you decide to cash out at a higher interest rate, you'll have to make a bigger down payment. The more you put down, the lower your interest rate will be.
One of the biggest advantages of refinancing is that you don't need to provide as much documentation. The worst thing about refinancing is that you have to refinance. Let's say that you have a $300,000 house and you decide to refinance to get a 15% rate. To do this, you have to send in a lot of paperwork (the good, the bad, and the ugly). You'll have to provide the mortgage company with your social security number, driver's license, proof of residency, and credit card statements. Believe it or not, this is more paperwork than you'll need to get a car loan. So, if you're looking for an easy way to make some extra cash, refinancing is the way to go. Just make sure that you're aware of all the pros and cons beforehand.
When you refinance your home loan, you normally have access to more financing. The best thing about refinancing is that you can get additional financing with little to no paperwork. The worst thing about refinancing is the additional paperwork. Let's say that you have a $300,000 house and you decide to refinance to get a 15% rate. You'll have to go through a mortgage broker to get this loan and will most likely need to put in a down payment of at least 20%. Most mortgage companies will only give you additional financing if you can prove that you're in a position to pay the mortgage back with the extra funds. So, in most cases, you'll need to come back and pay off the original loan plus interest before you can access the additional money.
One of the biggest advantages of refinancing is that you don't have to pay home insurance premiums. The worst thing about refinancing is that you have to refinance. Let's say that you have a $300,000 house and you decide to refinance to get a 15% rate. In most cases, you'll need to notify your insurance company that you're refinancing and will ask them to send you a statement adjusting your coverage for the change in ownership. After you make the payment, you can submit the request for a refund and won't have to worry about home insurance premiums again.
One of the major benefits of refinancing is that you can gain some tax advantages. This is especially beneficial if you're in a higher tax bracket. The tax advantages are based on the amount of money that you're refinancing. If you're refinancing to get a lower rate, you'll have to pay taxes on the difference. If you're refinancing to get a higher rate, you can take the tax deduction. For example, if you're in the 35% tax bracket and you refinance to get a 39% rate, you'll have to pay $13,600 in additional taxes each year. However, you can save $13,600 each year in mortgage interest by refinancing.
To refinance or not to refinance? That is the question. There are obviously pros and cons to both. If you want to make extra cash quickly, you can always refinance. However, if you want to keep your money in a savings account, you shouldn't refinance. Think about what's best for you and your family. Are you looking for an easy way to make some extra cash or do you want to keep your money in a savings account? For those in the latter, refinancing may not be the best idea. If you decide to go with this option, make sure to check out all the paperwork and know what you're getting into.
Have you ever considered the money you could save by looking into refinancing your home? When interest rates are low, you could save on your monthly mortgage payments! A mortgage refinance replaces your current home loan with a new one with new terms. This could include a new interest rate, the type of home loan, and the longevity of your loan. As the local real estate experts, Jeff Cook Real Estate can connect you with a trusted lender to help you begin the process of refinancing your home.
If your interest rate is 3% or higher, as long as your credit is good it is worth the effort to refinance and save money on your home payment each month! Additionally, if you purchased your home between 2013-2019, now is a great time to refinance and lock in that lower rate. Even if you refinanced in 2020 it might be worth looking to see if you can save even more money.
Before you dive into refinancing, it’s important to determine your goal. Are you looking to save on your monthly payment? Do you need cash to pay off debt? Do you want to shorten the term of your loan? Do you need to make home improvements? If you relate to any of the following scenarios... it’s time to begin the process of refinancing your home.
When choosing to refinance your home, there are many things that could change. Speak with a loan officer to create a customized plan for your refinance. Below are the different areas in which refinancing could benefit your mortgage plan.
If your current loan is an adjustable-rate loan you may find that your mortgage rate periodically adjusts. If you’re needing a steady payment each month, consider switching from an adjustable-rate loan to a fixed-rate loan.
Keep in mind when refinancing, if you choose to shorten your loan from a 30-year to a 15-year, the monthly payments will go up but you’ll end up paying less in interest over time. Additionally, if you need to pull cash out of your home, we offer those options as well.
Imagine your interest rate dropping by 2 points! Refinancing can potentially save you money on your monthly payment simply by refinancing with a lower interest rate.
The combination of lowering your interest rate and potentially removing PMI with a re-appraisal of your home could potentially save you anywhere from $200-$400 a month.
Jeff Cook Real Estate is proud to introduce our preferred lender, Interlinc Mortgage, and recommend their professional services to our clients. When beginning the refinancing process, you will work with one of Interlinc’s loan officers on a custom plan to make sure you get the most out of refinancing your home. Interlinc has a quick and efficient time frame of 20-30 days for your closing, which is almost 15 days less than the current average!