Overview & Benefits
Things to Consider with a Home Loan Refinance
Refinancing your home loan can provide many benefits and can be done for various purposes. The most common reasons for refinancing your home loan are to lower your monthly payment, shorten your loan term, replace an adjustable-rate or balloon payment or get cash out from the equity. If you are considering refinancing your home loan, check out our easy to use calculators to determine what your new monthly payment could be.
Lower Your Monthly Payment
If current mortgage rates are lower than the rate you received on your current home loan, you may be able to save money by refinancing your mortgage to a lower rate. In this case, you can refinance to a home loan which is the same term as your existing loan and possibly lower your monthly payment.
Shorten Your Loan Term
Another way to save money is to refinance your home loan to a shorter loan term. Many borrowers purchase their home using a 30-Year Fixed-Rate Home Loan, then refinance to a 15-Year Fixed-Rate term a few years later. Rates on 15-year loans are typically much lower than 30-year loans, so it could be possible to shorten your loan term without significantly increasing your monthly payment.
Convert an Adjustable-Rate or Balloon Payment
If your current home loan has an adjustable-rate or if you are facing a balloon payment, it may be a good time to consider locking into a fixed rate when current mortgage rates are lower. By refinancing an adjustable-rate mortgage, your monthly payments are likely to be less and will be the same for the rest of the loan term.
Using the equity in your home to borrow money is called a cash-out refinance. Many people choose to borrow using this method since mortgage rates are traditionally lower than other types of debt such as credit cards. And, the loan term of a home loan can provide a longer time to repay the money borrowed; up to 30 years.
Types of Refinances Available at Delta Community
- Rate-and-Term Refinance
- Fixed-Rate Refinance
- Adjustable-Rate Refinance
- Cash-Out Refinance
If you have questions about which Refinance options are right for you, please email a Home Loan Specialist or call us at 866-963-7811.