Refinance Your Home? Why, How and When
WHY Should you Refinance?
There are a few reasons to refinance, but you need to think about WHY you want to. What do you aim to do with the equity in your home?
Do you want to refinance into a lower interest rate and lower your mortgage payment?
Do you want to stop paying private mortgage insurance if you are currently having to pay for it?
Do you want to cash out some of your home’s equity to complete a home remodel or maybe help pay for your kid’s college tuition?
Last but not least, do you want to refinance your mortgage into a shorter-term?
These are all common reasons to refinance your mortgage. You have to pick the reason that is best for you and design your refinance strategy from that.
If you are having trouble crafting your strategy maybe you should start by finding out what your home is worth. At One Mortgage we have a nifty tool that gives you monthly updates of your home’s value based on market conditions and home sales in your area. You can access it for FREE by clicking the link below.
HOW Will you Refinance?
Now that you have a good idea of what you want to accomplish with your home refinance you can start figuring out HOW to do it in your current financial situation. There are four things you will need to evaluate before you refinance your current home loan:
- Check your credit score. There are plenty of free ways to check your credit score, but One Mortgage has teamed up with Experian to add a fast and convenient credit report tool right here.
- Calculate your desired mortgage payment based on what you can afford and what you feel comfortable paying. If you have questions and need help doing this please don’t hesitate to contact one of our mortgage and budget experts here at One Mortgage. together we can help you get to a monthly mortgage payment that you will be happy with.
- Evaluate your home’s value. After you have done some homework and a little bit of math, you are going to have to get an idea of what your home is worth. A lender can’t lend more than the home is worth and it will all your plans will be contingent on a home appraisal as well. I hope you took us up on our offer to calculate your home’s value for you with our nifty Homebot Home Value tool. you can access it for FREE here.
- Calculate Your Debt to Income Ratio. What exactly is a Debt-to-income ratio? It is your monthly debt payments divided by your gross monthly income. Your DTI is one way that lenders can calculate your ability to pay back what you intend to borrow. Most lenders require a DTI of 50% or lower for loan approval.
WHEN Will You Refinance
Now that you have a pretty good idea of how a home refinance can help you accomplish your cash-flow and mortgage goals you just have to decide WHEN.
Certain times are better than others, and it can change from week to week. Based on today’s interest rate, which is ______ you can click on our refinance calculator below to find out if now is a good time for you.