Rates On The Rise: Don’t Miss A Chance To Save Thousands
With the Fed implying a lean towards raising the rates one last time before the end of 2017 (expected in December), many homeowners are asking “Should I refinance my mortgage now?”
State Of The Union: Refinancing & Rates On The Rise
“Even with rates rising, it will still make sense for many homeowners to refinance a current home loan. With proper education and guidance, homeowners will be able to take advantage of lower rates now to achieve their affordable homeownership goals” remarks Get A Rate CEO Michael Sema.
“Homeowners can take advantage of a getting out of PMI payments, lowering their payments and even cashing out to consolidate high-interest rate debt, do home upgrades to boost their home’s value or even pay off student loans. As home values rise, it presents an opportunity for homeowners to make smart decisions and use their home equity to reach financial goals,” Sema adds.
The Black Knight Financial Services Mortgage Monitor Report based on July 2017 showed that as of August 2017, 4.41M borrowers could likely qualify for a refinance.
“Even with the rise in rates, there are several options for homeowners to refinance their current home loan and improve their financial position,” says Sema.
Other affordable home goals Michael talks about are refinancing to shorten terms to save money or to get rid of Private Mortgage Insurance (PMI).
Shortening Your Term
When you shorten your term, you’re saving more money on interest but sometimes the reason may be to plan for the future, whether it’s for retirement or future expenses.
If you’ve been in your home for a while and decide to retire earlier, you might refinance to a shorter term to have your retirement and mortgage paid off at the same time.
Or you might want to shorten your term to pay your last mortgage payment before your kids graduate college.
“A shorter term with a lower interest rate will allow you to pay less interest over time, saving you the most amount of money in the long run,” adds Sema.
With the proper guidance, you can time it so your refinance will put your future self in a solid financial position.
Dropping Mortgage Insurance
Purchasing your home was probably one of the most gratifying accomplishments you’ve done. But if you did it with less than 20% down, you had to also pay for mortgage insurance on top of your monthly mortgage payment.
However, there is a prime opportunity for qualified homeowners to do a home loan refinance and drop the mortgage insurance.
“Current homeowners have the chance to take advantage of historically low rates and refinance to secure a brighter financial future, “ advises Sema.