Why Should You Refinance Your Home
Refinancing is one of the simplest and most effective ways to reduce the interest payments on your home loan. With little to no switching costs and additional charges involved, refinancing enables you to reduce your payment term, without risking your property.
With Webmaxco.com, you can easily fill out and apply for a refinancing arrangement. Our portfolio features a variety of low-interest loans with varying credit periods, making it easy for you to target an arrangement well within your affordability range. Here are a few benefits you can avail when refinancing with us:
Alter Rate and Payment
For homeowners facing higher than market interest rates on their loan, it is a good idea to check out other financing agreements available in the open market. Refinancing offers several no-cost and low-cost incentives that can save you interest premiums and high rates with minimal to no investment opportunities. Similarly, short-term loans carry lower interest rates. Refinancing can help lower your monthly installments, as well as your overall credit period.
Adjustable Rate Mortgage (ARM) loans allow you to reduce and adjust your mortgage payments, especially when you’re a first-time buyer or if you’re looking for low payments initially. Over the course of years, if you decide to become a long-time owner and are not interested in flipping, then refinancing allows you to convert the adjustable loan in to a long-term fixed loan. In this way, you can assure yourself that your interest payment and rate will not change for a defined time period.
Interest-only loans work in a manner similar to ARMs. Since you’re only making interest payments without any principal repayments, the initial mortgage payments are low. In the longer run, however, your loan balance is not reduced - since you’re not paying back the principal amount. If you want to keep your home for the longer run, you can consider refinancing to convert the interest-only loan into a 30 year fixed rate loan to pay off the principal and gradually reduce your loan liability.
No Mortgage Insurance
Wherever home purchasing involves less than 20% down payment, there is always Private Mortgage Insurance (PMI) that accompanies. With the help of refinancing, you can eliminate and reduce the extra expense paid on account of PMI - in the event you have paid down on your loan balance and/or have witnessed a substantial increase in your home’s value such that at least 20% of your equity is tied up in your home or a loan-to-value (LTV) of 80% or less occurs.
Reduce Loan Term
Loan plans and packages tend to be volatile and are influenced by several market conditions. It is best practice to keep refinancing as an option should the conditions seem unfavorable. Similarly, if you’re planning to sell your home at any time soon, you might want to consider refinancing to convert your 30-year fixed loan to either an ARM or a 3/1, 5/1 or 7/1 loan scheme. The latter options carry lower interest rates and payments.
Leveraging equity in home is one of the most preferred ways to use cash to your advantage. The cash saved, in this regard, can be used to pay your credit card bills, medical bills, student loans and other dues. Through this process of debt consolidation and cash takeouts, you can make only one payment every month and decrease your overall monthly outflow.
Investing your hard earned equity back into your home for structural improvement is the smartest way to make even more money in the longer run. Fixing the roof leakages, remodeling the kitchen and applying a new layer of paint not only increases the fair value for flipping purposes, but also provide you with a list of tax-deductible expenditures. Consult Webmaxco.com today to calculate your long-term tax savings.
Purchase Investment Property
With home prices and interest rates hitting an all-time low this year, it might be a good time to evaluate all refinancing options for buying a vacation home or investing in a property. Check in to your home equity and down payment options today with Absolute Home Mortgage Corporation and learn more on how to get the best of refinancing.