Knowing When and Why You Should Refinance Your Mortgage
As you may have recently heard, mortgage rates are decreasing across the country at a rate that is inspiring many people to purchase a home or refinance their existing mortgage. Now more than ever, it is a great time to refinance, take advantage of low rates and secure your long-term financial future. With that in mind, I’d like to take a moment to offer some of my own tips for home mortgage refinancing and discuss how Nutmeg could help you.
One of the most popular reasons to refinance is to save money by lowering the interest rate. An interest rate that is just one percent lower than your current rate can make a major difference in the future of your loan. An interest rate of six percent on a $150,000 home mortgage reduced to five percent will have a monthly savings of $100 per month and a $34,000 in interest savings over the course of the loan! This more than outweighs the mortgage closing costs. Plus, depending on your current rate, you may even be able to save more.
Another very popular option is to borrow money with cash-out refinancing. If you have the equity built up in your home, you can refinance your existing mortgage and get the cash difference for home improvements or repairs. Depending on the amount you borrow, your monthly payment can stay the same and you will have a lump sum of cash to improve the overall value of your home.
Adjustable rate mortgages can also be a great option for some people. If you are not planning on staying in the same home for a long time, an ARM may be a good fit because you will move on before the rate increases. If you are currently in an ARM and your rate has increased, refinancing to a lower fixed rate mortgage may be the best option for you.
Even if you know all there is to know about mortgages and are ready to refinance, you will still need to choose a quality lender who is easy to work with. I would like to talk for a moment about Nutmeg’s newest partners at Mortgage Markets CUSO and what we can do for you. Mortgage Markets is a credit union service organization that specializes in providing innovative technology to seamlessly offer mortgage products. With this new partnership, our entire portfolio of mortgage products can be applied for faster than ever online and at your own convenience. We are even offering a special $500 discount on mortgage closing costs until August 31, 2019!
With all of this in mind, I am confident that right now is a great time to refinance your mortgage. Always remember to ask yourself why you are refinancing and how it will affect your long-term financial health. If refinancing seems like the right choice for you, Nutmeg and our partners at Mortgage Markets would be happy to help you fulfill all your mortgage needs.
As always, we will do everything we can to push the boundaries of the banking industry and improve your experience with new technology. I look forward to sharing more about our future advancements and innovations with you in the months to come.
President & CEO