Is it Smart to Refinance?
One of the questions I often hear as a Mortgage Originator is ...
"Would it be smart to refinance my mortgage?"
Especially with interest rates currently holding (reasonably) steady at advantageous levels ... and most U.S. housing markets now experiencing rising housing values again, it's a timely question for current homeowners to be asking.
Equity's on the rise again in the majority of U.S. markets and many homeowners have hopes and plans for its use. Knowing how, when, and if it's smart and timely to draw on available equity is important.
But unfortunately, this is not a question quickly or easily answered. So when I'm asked it, my answer is frequently, "it depends".
Now I'm not trying to dodge the question or be coy when I say that. Rather, it's just that there's no magic equation to conduct or set time to define when it's wise or time to refinance. If only it was that simple ...
In order to distinguish if refinancing makes sense or provides value to a Borrower, I need to ask questions. Lots of them. And I need to examine some facts first.
(A bit of a warning here: If you've talked to an LO regarding a refinance and they provided you a quick answer without asking questions first? Don't rely too heavily on the wisdom or validity of the answer heard.)
People inquire about refinancing for a variety of reasons. Their motivations and needs vary. I need to know what yours are ... and what your goals are ... in order to advise and assist you properly.
Some questions I'll raise include:
- Do you hope to lower your interest rate and monthly payment?
- Shorten your mortgage term or pay off your mortgage note in a shorter time-frame?
- Are you hoping for "cash out" for ???? Do you hope to eliminate PMI (Private Mortgage Insurance)?
- Do you want to consolidate or pay off credit cards, second mortgages/HELOCs, etc?
- Do you want to convert to/from an ARM?
- Take another Co-Borrower off the prior Loan?
- More ...
There's a recurring theme I stress regarding mortgages. It revolves around their individuality. No two are alike, as each Borrower's credit, finances, needs, and goals are unique.
Two seemingly similar scenarios can reach two vastly different outcomes as a result of very minor differences between the Borrowers. Even small differences can have a huge impact.
This is precisely why I always stress: Borrowers should never compare their situation with another's.
You are unique ... and so is your life, finances, needs, and goals. In order to reach a sound reliable answer to your refinancing question, you and I need to talk/communicate. To have an opportunity to ask questions back and forth. To share information.
Anything short of that exchange will leave you with an unreliable answer to your refinancing question ...
In the Chicagoland area, Illinois, and Wisconsin ... let's talk now ...
* Looking to find what refinancing options and possibilities exist for you?Hoping to Buy or Refinance a Home in New Lenox, Will County, or elsewhere in the Chicagoland area? Contact me! I'll put my 40+ years of Mortgage experience and expertise hard to work on your behalf.I'm easily found at:
Mortgage Originator - nmls #216987 - IL Lic. 031.0006220 - WI Licensed
American Portfolio Mortgage Corp.
Gene Mundt, Mortgage Originator, an Originator with 40+ years of mortgage experience, will offer you exemplary mortgage service and advice when seeking:
Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago and the
greater Chicagoland region, including:
The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena,
Manhattan, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook,
Romeoville, Naperville, etc.), DuPage County, the City of Chicago, Cook County,
and elsewhere within IL & WI.
Your Referrals are Always Appreciated and Welcomed!