Most people refinance their mortgage in order to obtain the lowest interest rate for which they qualify. Currently, Americans have the opportunity to refinance at historically low interest rates on 30-year, 15-year and adjustable-rate mortgages.
Common reasons for homeowners refinancing include gaining financial relief from underwater mortgages, lowering monthly mortgage payments, building home equity or all of the above. Some homeowners pull equity out of their homes to pay off credit card debt. Others desire to refinance into loans with shorter amortization, which build equity faster or correlate the final mortgage payments with retirement plans.
Depending on your personal circumstances, many homeowners who want to refinance their mortgage have a number of options compared to several months ago.
Which refinancing option suits your situation?
Rate and Term Refinancing
This allows you to borrow enough to pay off your current mortgage balance. You can either modify the interest rate on your loan, change the loan term or you may adjust both. For instance, you may change from a Fixed-Rate Mortgage (FRM) to an Adjustable Rate Mortgage (ARM) if you do not plan on staying in your home. A homeowner might also choose to refinance from an Adjustable Rate Mortgage into a Fixed Rate Mortgage when the rate of an ARM is expected to adjust upwards. Your Cliffco Loan Specialist will educate you on the loan program that suites your personal needs.
Cash out Refinancing
This option leaves you with excess cash amount after you have paid off the current mortgage balance. You can extract cash proceeds from your home equity.
Streamline Refinancing
Streamline refinancing refers to the documentation and underwriting carried out by any lender in order to find out if the borrower would qualify for a refinance loan. This is a kind of loan program that does not require any credit verification but may or may not require an appraisal.
A mortgage refinance represents one of the most important financial transactions you will ever make. Count on your Cliffco Mortgage Specialist to educate you on the loan products and refinancing options suited for you!
FREE same day pre-qualification makes refinancing easy!