Refinancing your home loan can be a beneficial step towards restructuring your finances. With proper guidance and the right game plan, you can be confident that when you decide to refinance your home loan, it will be the best move for you. Vince Kingston is one of Portland, Oregon’s top loan officers, here’s his insights on how refinancing can be a very beneficial financial move.
Here’s Vince’s 10 Reasons to Refinance:
1) Lower Monthly Payments
- Obtaining lower monthly payments is the most popular reason for refinancing a home loan. Because the stability of lower monthly payments gives you more financial freedom and peace of mind.
2) Debt Consolidation
- Refinancing your home loan with a ‘cash-out refinance’ can consolidate several high interest debts together, such as auto loans and credit cards. Therefore, by combining various accounts into a single lower interest loan, you’ve now made your debt more manageable.
3) Private Mortgage Insurance
- The costly addition of private mortgage insurance can dig deep into your pockets. If you’ve built up enough equity in your home, you may be able to drop your private mortgage insurance through a home loan refinance.
4) Changing Loan Programs
- Many people choose an adjustable rate mortgage when they first jump into their home loan. The lower interest rates in the beginning can be appealing. However, they can also fluctuate & increase significantly without warning. Moving to a fixed rate mortgage can be a beneficial move, especially when rates are down.
5) Building Equity Faster
- Let’s say your salary has increased…as a result you are now able to pay a higher mortgage payment than is expected. In this situation you should consider refinancing from, perhaps, a 30 year loan to a 15 year loan. In the long run you’ll save more money on financing fees and you’ll also build your equity faster. Win-win.
6) Lower Interest Rates
- If you’ve been making your payments on time, your credit score will positively reflect that. Once you’ve seen a significant boost in your score, compared to when you started your home loan, you may want to pursue a refinance. Because if you refinance with your improved score, you’ll receive lower interest rates!
7) Creating a holistic financial plan
- Every homeowner should consider their mortgage as one part of a comprehensive financial plan. And when a person can use refinancing strategically, it can help you in a multitude of ways. For example, it could:
- Help fund your children’s college expenses
- Fully fund your tax advantaged retirement accounts
- Cover costs when you add improvements to your home – which may increase its value and/or rental income
- Help build equity to safely purchase additional homes without tapping into your own personal savings
8) Using Equity when life throws you a curveball
- Life circumstances can change abruptly and when they do, they are often beyond our control. Events such as death, serious injury, or illness can come up when we least expect it. Refinancing can allow you to use your equity to help you and your loved ones during these times of need.
9) Financing Life Changes
- On the flip side…rather than unexpected tragedies, sometimes beautifully expensive blessings are handed to us, like babies and weddings. Refinancing to assist in paying for the happy times can be more beneficial than taking out a separate high interest loan.
10) Meet Your Goals
- Gaining control of your finances will assist you in achieving your goals. Whether you want to start a new business, build your dream kitchen, or expand your family. Life changes are inevitable, so let me help you plan ahead and get set up for success!
I am always available to talk and can help you with all of your refinance inquiries. The right time to refinance may be closer than you thought. Take a minute to contact me and we can work together to create the perfect plan for you.