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Refinancing Your Home

So how do you know if you should refinance? Refinance can help you meet a variety of personal and financial goals such as lowering monthly payments, consolidating debt, remodeling, or even paying for a child’s (or your own) education. Refinancing will completely replace your current mortgage with a new loan that provides you with new term, rate and monthly payment.

Mortgage rates have continued to hover at two-year lows. That’s great news for homeowners across the country. Lower rates are an excellent time to evaluate your current mortgage and see if lowering your rate or changing loan products is the right financial decision for you.

With Vellum’s simplified, digital home loan experience Elevate, refinancing your current mortgage is easier and faster than ever before. And you’ll never be alone on your journey – we’ll walk you through every step, helping you find the loan that’s best for your financial goals and situation.

Why Most Homeowners Decide to Refinance

While rates are low it’s a good time to evaluate your current mortgage and see if one of the below options might fit your financial story.

Secure a Low Interest Rate

If you’re looking for a way to lower your mortgage payments or get your home loan paid off faster, refinancing may be a good option. Refinancing involves swapping your existing mortgage for a new one with more favorable terms. Reducing your interest rate not only helps you save money, but it also increases the rate at which you build equity in your home, and it can decrease the size of your monthly payment.

Cash-Out Refinance

If you’ve built up significant equity through your monthly payments and your home’s appreciation, a cash-out refinance may make sense to improve your general financial situation or the value of your home. With a cash-out refinance, you’re refinancing your mortgage for more than you currently owe and, in return, getting a portion of your equity back in cash.

Remove FHA Mortgage Insurance

The mortgage insurance fee on a conventional loan is lower than it is with FHA. To stop paying mortgage insurance on an FHA loan you will want to refinance into a conventional mortgage. If you have paid down the loan to 78% of the value of the home you can refinance into a conventional mortgage without having to pay mortgage insurance. If your loan-to-value is still pretty high you can lower your interest rate and monthly payments with an FHA streamline refinance

From an ARM to a Fixed Rate

Reduce interest rate risk. While interest rates have been on the rise recently, they are still near historic lows. Refinancing could be an opportunity to lock in a low rate for the life of your mortgage and protect yourself against the risk that rates continue to rise. While no one can predict what interest rates will do going forward, refinancing into a fixed-rate mortgage would remove the risk and potentially remove some anxiety as well.

Reduce Your Mortgage Term

A 15-year mortgage or a 20-year mortgage is the dream home loan for home buyers who can afford the much higher monthly payments and want to shred their mortgage in half the usual time while saving thousands or even tens of thousands of dollars in interest. A shorter term mortgage comes with a lower interest rate and higher payment amount, but builds equity faster because you pay down the principal balance quicker.

Receive a Complimentary Mortgage Checkup

Over time, your financial story and life situation will change. Having a checkup is a great way to ensure that your mortgage still aligns with your current goals, even if you didn’t get your original loan with Vellum.

Let’s Get Started Refinancing Your Home

You’re so close to refinancing to meet your financial goals. Let’s do this!