Everyone wants more cash in their pockets. If you refinance your home, you might end up with a little extra to spend or save each month. If a lower monthly mortgage payment sounds appealing, MortgageDepot will help you decide if refinancing makes sense for you.
Refinancing: A Tool To Lower Your Monthly Payment
When money is tight, it’s natural to look for ways to lower your highest monthly bill. For many people, their highest monthly bill is their mortgage payment. Refinancing might make a positive impact on your budget. Here are three ways that you can reap the rewards of refinancing:
Refinance to a lower interest rate: We usually say that refinancing is a smart move if you can lower your interest rate by one percentage point. Depending on closing costs, you might still benefit from a .5 to .75 percent decrease.
Refinance to a longer term: If you have been paying on a 30-year mortgage for ten years, you could refinance the remainder of your mortgage to another 30 years. If you do this, you’ll take a total of 40 years to pay off your home (if you stay in it that long). You might also pay more in interest, so consider this move carefully before you act.
Refinance to a conventional loan: Are you paying for mortgage insurance each month? Refinancing to a conventional loan might allow you to drop this requirement and save money. You’ll need to wait until you have 20 percent equity in your home for this tactic to work.
As Pennsylvania’s mortgage experts, MortgageDepot has the answers to all of your questions about even the most complicated refinancing situations. If you want to learn how to make refinancing work for you, connect with us today and lower your monthly payment!