Mortgage Refinancing: Is it Time to Refinance Your Adjustable Rate Mortgage
By Louie Latour
If you purchased your home using an Adjustable Rate Mortgage and are concerned with the direction interest rates are heading, refinancing to fixed rate mortgage could help your financial peace of mind. Mortgage refinancing will give you a fixed payment amount that you can plan your budget around. Here are several tips to help you decide if refinancing your Adjustable Rate mortgage is right for you.
Mortgage interest rates have been rising for the past several years. If your lender is scheduled to reset your Adjustable Rate Mortgage soon you can expect your monthly payment amount to go up with a higher interest rate. If your monthly budget is already stretched to the limit, mortgage refinancing to a fixed rate loan will prevent your payments from going up and could even lower your mortgage payment.
Mortgage Refinancing to Lock in Your Payment Amount
When you refinance your adjustable rate mortgage to a fixed rate loan, you will lock in the payment amount for that interest rate. Your mortgage amount will not change for the entire duration of your loan. It is still possible for your payment amount to go up if you pay your property taxes and homeowners insurance in escrow; however, interest rate hikes will not affect your mortgage.
Mortgage Refinancing to Lower Your Mortgage Payment
Fixed interest rate mortgages typically come with slightly higher interest rates than an Adjustable Rate Mortgage. If your financial situation has improved since you purchased your home, you may qualify for a lower interest rate when refinancing. Even if you cannot qualify for a lower interest rate you can still lower your payment amount by extending the term length of your mortgage.
What is Term length?
The mortgage term you choose along with your interest rate determines what your payment amount will be. Term length is the loan duration; the longer your loan’s term, the smaller your payments will be. Traditional mortgages come with term lengths of thirty years; however, there are now forty and fifty year mortgages available. By choosing a fixed rate mortgage with a longer term length you can not only lock in your interest rate but lower your payment and free up cash in your budget. You can learn more about mortgage refinancing while avoiding costly mistakes by registering for a free mortgage guidebook.
To get your free mortgage guidebook visit RefiAdvisor.com using the link below.
Louie Latour specializes in showing homeowners how to avoid costly mortgage mistakes and predatory lenders. For a free copy of “Mortgage Refinancing - What You Need to Know,” which teaches strategies to find the best mortgage and save thousands of dollars in the process, visit Refiadvisor.com.
Claim your free mortgage refinance information guide today at: www.refiadvisor.com
Mortgage Refinance Information
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