With interest rates at historic lows, many Texas homeowners are asking themselves if now is a good time to refinance. And for many, the answer is yes! But what the answer is for you depends on many factors. Let’s walk through the most important ones.
Time you plan to remain in your home.
This is perhaps one of the most important considerations. If, for example, you are planning on moving to a different home within the next few years, refinancing just might not be for you at this time. But if you plan on staying in your existing home for at least five to seven more years, then now could be a good time to refinance your home loan.
At Crystal Clear Mortgage, we’re committed to ensuring home loan you have is the right one for you
The interest you’re currently paying.
If you only recently got your home loan and already have a low interest loan, then the interest savings you get from refinancing your home loan may not outweigh the costs involved. Because a refinance is a home loan, it requires most of the usual steps taken with a purchase loan, including appraisal, and therefore comes with a variety of fees. If you have a higher-rate loan, it is likely that the savings you can enjoy from lowering your rate can outweigh those costs. At Crystal Clear Mortgage, we can detail all your anticipated costs and interest savings to make sure refinancing is right for you.
The type of loan you currently have.
If you are currently in a 15-year mortgage, for example, but need a longer term for lower monthly payments. Or maybe you are looking to change from an adjustable-rate mortgage to a fixed-rate mortgage to avoid the risk of future rate increases. You may also need to change who is responsible for paying the mortgage – such as after a divorce. (Please just keep in mind that removing an ex-spouse from a loan does not remove them from the deed, as that is a separate step.) In any of these cases, refinancing is an excellent option for you. If you are paying FHA loan insurance, a refinance to a conventional mortgage can also eliminate that cost for you.
Whether you need cash.
If you’ve built a lot of equity into your home and need cash for a major expense – or if you need to consolidate high-interest-rate debt – a Crystal Clear Mortgage loan officer can work with you to make sure that refinancing is a good option for you.