When you refinance your mortgage, you are taking out a new loan to pay off and replace your existing loan. This is usually done to accomplish one of several things:
- Pull cash out of your home’s equity to remodel, complete major home repairs, pay off debts, or invest in other things
- Convert from an Adjustable Rate Mortgage (ARM) to a Fixed Rate Mortgage
- Secure a lower interest rate and reduce your monthly payment to save money
- Change the length of your loan so you can pay it off more quickly
Watch how a cash-out refinance helped a family
Why Would I Want to Refinance?
The major benefit of a reverse mortgage is the ability to buy a home or access cash without having to make a monthly payment, alleviating borrowers’ financial burden. They are used for many purposes, including:
- Creating additional income or a financial safety net of available funds
- Financial planning to delay drawing Social Security
- Downsizing or Upsizing
- Relocations to be closer to family members or medical facilities
- Purchasing a second home or rental property
- Gifting funds to family members
- Rescuing family members in financial distress
Free Up Cash: This type of loan is used when consumers have equity in their home that they want to use for a variety of reasons. These may include remodeling or completing major home repairs, paying for college, making a down payment on another property, or purchasing a personal asset like a car or boat.
Better Interest Rate: This helps you save money either immediately by lowering your monthly payment, or over the life of the loan if you combine the lower interest rate with a shorter loan length.
Debt Consolidation: Interest rates on consumer debts are typically higher than those on home loans, so refinancing to consolidate debt can save you a lot of money on interest – not to mention the convenience of making one simple payment a month. When you refinance, you take out some of the equity in your home to pay off recurring obligations, and often the amount of your new refinanced mortgage is less than the combined total of all your previous debt payments.
Reduce Risk: There are a couple of ways to reduce risk through refinancing. First, you may switch from an Adjustable Rate Mortgage to a more predictable Fixed Rate Mortgage. You may also choose to reduce the length of your loan, allowing you to pay off your mortgage and get out of debt more quickly.
How Much is My Home Worth?
Wondering how much money you could save by refinancing? With interest rates still near all-time lows, now is the time to consolidate debt, complete that remodel, and secure a predictable low monthly payment on your mortgage.
Whether you are thinking about pulling cash out to potentially sell your house, its critical to have a solid estimate of what your home’s value is.
Why choose TILA Mortgage for your refinance loan?
Our licensed loan officers are committed to you and the highest standards of ethical lending. We believe that our customers are our primary focus and our goal is to always exceed your expectations.
Do I Qualify?
TILA Mortgage is a DBA of Hometown Lenders, Inc. Our experts are committed to helping you qualify for a great loan at a great rate.
We’re standing by ready to help you, too. Learn more about our complete loan process here.
*TILA Mortgage does not guarantee that your debts will be lowered by a specific amount or percentage or that you will be debt-free within a specific period of time. A debt consolidation may increase your monthly cash flow, but may increase the amount of your debt over a period of time by including the additional debt in your mortgage amount, which is financed over a longer period of time than the debt consolidated may have been financed. We encourage all consumers to do their own research, and examine their options carefully before selecting a particular course of action.
5 Easy Steps:
Have initial conversation with a TILA Mortgage Specialist
Discuss options and choose the best loan product
Complete your loan application
Appraisal, title, credit, and processing
Final signing and loan funding