Refinancing an existing mortgage to a lower interest rate is one of the most common ways for a homeowner to reduce his or her monthly mortgage payment. In this scenario, the homeowner benefits from both a lower monthly mortgage payment and a lower interest rate over the life of the loan.
In addition to lowering your interest rate, there are other ways in which a refinance can lower your monthly mortgage payment. These include:
- Eliminating the requirement for private mortgage insurance: If you are currently required to carry private mortgage insurance, then this costly requirement will be lifted once your mortgage balance is 80 percent or less of your home's total value. Refinancing your mortgage can help you to reach this goal more quickly.
- Changing the term of the loan: For example, you may be able to switch from a 15-year to a 30-year loan, or from a principal and interest payment to an interest-only mortgage payment.
- Consolidating two loans into one: This can potentially save you $100 or more per month.
Your dedicated Mortgage Specialist can help you to determine the right refinance solution for you. We encourage you to learn more about your mortgage options today.