Why It's Not Too Late to Refinance

Refinancing. Whether you’re a new homeowner or bought many moons ago, we’re ready to help you save money. Refinancing your home loan might not have been on your radar at first glance, but knowing the rates and when to take advantage of them should be. It is likely you’ve heard the word tossed around, but do you understand exactly what it means?

Defining refinancing…

Refinancing is the process of financing your loan all over again but with different loan conditions. The simplest explanation is that you are replacing an existing mortgage with a new loan. This new loan may have a shorter or longer term than you originally had. Your interest rate may be lowered. Your payment may be lowered. You may have access to equity you have in your home.

Even if you don’t understand or know how to take the next step into refinancing, it’s worth reaching out to us to see if you should. Spoiler alert: you should!

Getting a 1 to 2% drop in interest rate could make a huge dent in your monthly mortgage and could help you pay off your mortgage even sooner. Win? We think so.

Deciding on specifics…

If you’re trying to figure out which is better for you, a 15-year term or a 30-year term, it really boils down to your budget. What do you feel comfortable spending each month for your mortgage payment? If you’re thinking you’d like to pay off your mortgage sooner and you think the combination of that lower interest rate and shorter term will help you, let’s talk about it. But if you’re thinking that your budget could be too tight with a higher payment then maybe focus on the 30-year term.

Steps to saving money

1. Determine what your short-term vs. long-term financing goals are. Consider whether you’re planning to stay in the home forever, or if this is just a starter home. It’s important to understand what those financial goals are.

2. After gathering important information and documents, we can discuss the best refi for you. There are several options when it comes to refinancing. Whether you’re refinancing to lower your monthly mortgage payment or interested in a cash-out refinance to pay for that kitchen renovation, we can sit down and discuss the right path for you.

3. Processing your loan. After we finalize the right plan for you and your family, our Atlantic Bay Operations family takes over the processing. This is where we’re dotting those i’s and crossing those t’s to ensure we have everything we need to get the loan completed.

4. Clear to close. Hearing those three little words, has a mighty big impact on saving you money. Your loan has been processed and we’re onto the closing table.

5. Receive closing instructions. The nitty gritty closing instructions will likely be explained to you, but you’ll also receive them in a document, so the specifics are laid out for you and you know what to expect step-by-step at the closing table.

6. Close. Hooray, we’re all set!

The steps to refinancing might look similar to when you first bought, and they should! You’ll still need to provide the same documentation as things might have changed over the course of time. Remember, you’re getting a new loan on your home at a different rate, so we still need to go through the process above.

Why else would you want to refi…

Do you currently have an adjustable-rate mortgage? Refinancing may get you that fixed rate you’ve heard about! If you currently pay for private mortgage insurance (PMI), you may be able to remove it by refinancing into a loan type that doesn’t require a PMI. You may want to refinance simply to access the equity in your home without getting a home equity line of credit or second mortgage. Some people even refinance so that they can pay their real estate taxes and homeowners insurance apart from their monthly mortgage payment.

If you’re on the fence about whether you should refinance, just know that now is a great time to consider it. Call me with any questions and we can see what option is right for you!