Why would I
refinance my existing mortgage?
- To decrease
your monthly payments from a higher fixed-rate to a lower
fixed-rate, consider this: If your current rate is 8.5%
and you can switch to a 7.5% rate, you can save 1% on the
mortgage less the costs of refinancing. For example, on
a $200,000 mortgage the savings will be over $50,000 just
by reducing the interest rate 1% over 30 years.
- To maximize
short-term cash flow, "how do I do it?" With lower
payments and a longer term. You may find cash flow is tight
after moving into your new home when, perhaps, things need
to be fixed or replaced.
- You could switch
to a fixed-rate program to eliminate the payment changes
of adjustable-rate mortgages or ARMs. Homeowners with one-year
ARMs starting at 6% or lower could see rates rise to about
8.25% within the same year.This can bring immediate savings
and protect you against an even higher rise in your adjustable-rate
loan next year.
- You may want
to withdraw funds from the equity of your home. If you need
cash for home improvements, college education, or debt consolidation,
you may be able to refinance and inmprove your monetary
cash flow by hundreds or thousands of dollars.
Would refinancing
be worth it for me?
There are several
factors to consider when making this determination:
- What will be
the difference between your old rate and the new rate?
- What are the
total costs associated with refinancing?
- How closely
is the loan term matched with the expected holding period
of the loan?
- How comfortable
are you with possible payment changes over the life of the
mortgage loan?
- Is a first mortgage
structure sufficient or should you add a home equity line?
The savings obtained
from refinancing can depend directly on answers to these
questions. To help in determining what would be most beneficial
to you, it is best to answer these questions with the help
of an experienced mortgage professional. Asset Mortgage
can help you determine the benefits for your particular
situation.
What about my
credit report?
Credit reports
can contain errors. In the past, consumers could only guess
if they were denied credit by accident or due to incorrect
information. Today, you can obtain copies of your credit history
from the major credit reporting bureaus:
TRW 1-800-682-7654
Trans Union/Credit Bureau of CT 1-203-931-2035
Equifax 1-800-685-1111
Or, call Asset
Mortgage and we will review your credit report free of charge
over the phone!
800.422.5701 or
610.670.2700 (Berks & Lancaster Counties) or 570.385.8280
(Schuykill County)
If you have a question or need more information, please e-mail
us directly. If you are interested in a purchase, refinancing
or home equity information, feel free to fill out our pre-qualification
application.
