Your mortgage is a long-term financial commitment that allows you to obtain and keep your beloved home. It might be time to consider how refinancing can benefit you. For more than 20 years, the homeowners of Minneapolis, MN, have turned to Fairway Independent Mortgage Corporation for a stress-free loan process and the most favorable mortgages. Below, their professionals explain the options for those who want to refinance their mortgage and how to achieve refinancing.
A Guide to Mortgage Refinancing
What Does It Mean to Refinance a Mortgage?
Refinancing a mortgage involves taking out a new loan on your home to replace your current one. You’ll be issued new interest rates, monthly payments, and other terms.
What Are My Refinancing Options?
You’ll have a few loan options once you’ve chosen to refinance:
- Lower Your Monthly Payment: To give yourself more cash every month, you might want to lower your monthly payments. One option is through an adjustable-rate mortgage, which has a lower interest rate than a fixed-rate mortgage. You can also change the length of your loan. For example, you can move from a 15-year to a 30-year mortgage, which will decrease your monthly payments since you’re committed over a longer period.
- Get Cash: If you require large sums of cash for things like college tuition, you’ll want to refinance your mortgage and extend the length so that the new loan is greater than the amount you currently owe. A 30-year mortgage, for example, would be best since you’ll receive the lowest possible monthly payments. However, if you’re trying to eliminate debt, you’d benefit from a shorter mortgage term. You’ll pay off your home in less time and can use the cash you save on interest to get rid of other debt.
- Shorten Term Length: The quickest way to become mortgage-free is by keeping your mortgage term short. You’ll have higher monthly payments, but you’ll have a lower interest rate. In the long run, you’ll save money from fewer monthly payments and less interest.
What Does It Take to Refinance?
Most lenders will require you to pay your current mortgage for at least one year. You’ll then need to collect your financial information, including mortgage statements, pay stubs, and monthly debt payments, such as those for credit cards. After that, contact your mortgage company. They will use this documentation to determine the best loan terms for your financial situation.
Are you interested in refinancing your current mortgage? Give Fairway Independent Mortgage Corporation a call at (952) 797-6032. Their team is dedicated to making their customers feel secure and knowledgeable about the loan process whether they’re looking to finance a small piece of property or a large rural land tract. They’re one of the top mortgage companies in the area due to their variety of services, including fixed-rate mortgages, reverse mortgages, and refinancing. Visit them online to learn how they can make refinancing a simple and easy experience.