3.    Should I refinance?

There are at least four reasons that you might consider refinancing your current mortgage: rate reduction, investment, safety, and debt consolidation.  

Rate reduction can be an excellent idea. For example, you are currently paying 7.5% in interest on your 30-year, $200,000 fixed mortgage and we can get you 6.75%. This will save you about $100 per month. Or, you may be in a position to change from a 30-year to a 15-year mortgage, which usually is about 1/2% lower than a 30-year (contrary to popular belief, the payments are only about 30% higher on average). Again, a simple analysis will disclose how much money you can/cannot save over time. We’ll do it if it makes sense; we won’t if it doesn’t! That’s why we’re here, and that’s how we hope to become "Your Mortgage Consultants for Life".

Investment. Sooooh, who said you should settle for owning just one home? If you have enough equity in your present home, how about using that equity for the downpayment on a second home to be used by you part of the year or to be rented out? Call us to find out what can be done.

Safety. You took out a 7-year ARM ( ARM = Adjustable Rate Mortgage) at 6.75% six years ago. This loan is fixed for seven years, then adjusts to market rates for the next 23 years. If you think interest rates will be going up significantly very soon, it may be a good time to refinance into a 15-, 20- or 30- year fixed rate. Conversely, you may think that interest rates will go down for many years down the road, so how about that 1-year ARM at only 5.25%….? Again, talk to us – it’s why we’re here, it’s for free and a good way to stay in touch.

Debt consolidation. You may consider refinancing if you save on the  interest rate and significantly reduce your monthly payments by taking out cash from the equity of your home to get rid of higher interest debt, such as credit card debt. Within limits, the interest you pay on such a loan can be tax-deductible (one idea is to finance a vehicle this way). We will run an analysis for you to determine if it is a good idea. We are a little different in the sense that if it is NOT a good idea, we’ll be the first to tell you. Promise us, that if we do refinance for the above reason, you’ll commit to getting rid of some of those credit cards you’re now paying off, OK?