(Financial mentoring) Refinancing Your Home
No commentsBy Brad Cullipher
Refinancing your home is an extremely important option to homeowners for many different reasons. While there is a cost involved, typically the benefits far outweigh the negatives and homeowners sleep easier at night following a refinance. Here we will address a number of very important reasons why homeowners seek to refinance their homes and the benefits it may give to these individuals.
Interest Rate Reduction
Currently, interest rates are at an all time low in the United States. We havent seen interest rates this low in decades, as they have been this way for about the past 12 months. Although the rates do vary daily so it is important to check with a lender or mortgage professional, if you happen to be eligible to refinance from a higher interest loan, you could save thousands of dollars simply by refinancing. This will also potentially lower your monthly payment, meaning more money in your pocket to pay your monthly expenses. There are closing costs and other fees to be concerned with, so consulting with a professional is necessary to see what your true savings amount will be.
Removing/ Adding Names from a Mortgage
Many people choose to refinance their homes due to marriage or divorce. If you become married, it is a good idea to be added to the home loan you are paying towards in case of unfortunate divorce or death. Similarly, if a couple becomes divorced, it is typically necessary to remove one party from the deed. This can be done through a refinance and the name removal is typically ordered by the courts in the divorce proceedings. Some people choose to sell, but many people who want to stay in the home will refinance, removing the other party from the loan and ownership of the property.
Solid Loan Options
People also often choose to refinance simply to change programs. If a person gets into their home using a balloon payment program, typically within a few years they choose to refinance to move to a safer, fixed rate mortgage. Of course the value of this depends on your overall goals and how long you plan to live in your home, but for many, this is a decision that solidifies future financial safety and avoids the mortgage increases substantially in the future.
Get Rid of High Interest Debt
Those who experience unfortunate personal losses like disability or loss of a job almost always begin putting living expenses on credit cards. If you wind up in severe debt but have a lot of equity in your home, many people choose to refinance and pull money out of the equity, to pay off high balance, high interest credit cards, and to settle into one monthly payment versus owing many creditors money. This can be a fix in many cases, although you must first have equity in your home to be able to do so.
Refinancing can be the key to putting yourself on a better path. If you are interested in refinancing, speak with a mortgage lender right away to see what you may qualify for.
American Capital Home Loans is your professional mortgage company specializing in home loans, mortgage, refinancing, reverse mortgages, debt consolidation, and home equity loans. Serving Austin, Dallas Mortgage, Houston, San Antonio, Ft Worth, and all of greater Texas.
Home Loans in a Bad Economy
By Brad Cullipher
The recession and recent difficult economic times over the past several years have put horror stories in to the minds of many people considering home loans. We are constantly hearing horror stories of friends and family being foreclosed on, seeing the realization of balloon payment loans, or being turned down for equity loans. Many Americans are feeling the strain of being upside down on their homes even though they have put years and years of payments towards their homes. Although it has been a very difficult few years, many people who are financially solvent right now are able to take advantage of this stressful situation and get into a home for a reasonable price at a great interest rate.
There are several reasons why now may be a good time to get into a home loan if you are a new home buyer, or if you have been a solid payer on your current loan but are ready to upgrade to something new. For those folks who have maintained their good credit through the past several years, now may be the best time to buy, and here are a few reasons why.
First, housing prices are at a low point, at least as far as researchers are concerned. We will never go back to prices similar to those over ten years ago because of the quickly rising market that increased home values to an exorbitant level. But what researchers look at is where the bottom of the market seems to be, and it seems as though it may be now. Homes are starting to sell again, and people are starting to gain a bit of equity back. Now is the time to buy if you are ready, before the market starts making a comeback.
Secondly, there is a government tax refund happening right now if you buy a home. At first, this started as a first time home buyer tax credit, where buyers needed to repay a certain amount per year until the 0% interest loan is paid off. The government then changed it to be a tax refund, meaning it is not required to be paid back. Then, to stimulate the market even further, they expanded it to allow people who had previously bought a home to see some of the reward. It is important to consult with a mortgage or tax professional to fully understand these tax benefits, but the government has tried to encourage people to get back to buying which is why these programs came about.
Lastly, people with good credit are being rewarded. For so long, mortgage carriers were giving mortgages to people who shouldnt have had them. Then, the market was so strict that barely anyone could buy a home. Now, things are settling down, and people with good credit are being rewarded with easier to get loans at interest rates that are lower than those throughout about the last 30 years of history. For those who saved money and are ready to buy, now is the best time to qualify for good home loan programs that previously may not have been available.
American Capital Home Loans is your professional mortgage company specializing in home loans, mortgage, refinancing, reverse mortgages, debt consolidation, and home equity loans. Serving Austin, Dallas Mortgage, Houston, San Antonio, Ft Worth, and all of greater Texas.
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Thursday, March 11th, 2010 at 9:00 pm and is filed under finance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
