Benefits of Lowering Your Monthly Payment
Whether through reducing your interest rate or extending the length of your loan, refinancing your mortgage to get lower monthly payments can offer a variety of benefits you may not have considered.
- Get some extra in the short term: Lowering monthly payments gives you a little more money each month that can be used for a variety of daily expenses – retirement savings, a college fund, a vacation, home improvements and more.
- Save more in the long term: If you are lowering your monthly payments by lowering your interest rate, you may save money each month and over the life of your loan – but remember that your interest rate is only part of the story. You should verify that the overall savings outweigh the refinancing costs.
- Apply savings to debts: You can also apply what you save each month to the payment of other debts – either directly through the increased money you have available or through a debt consolidation loan.
- Adjust or stabilize your rate: Extra cash flow is just one potential benefit to mortgage refinancing. Depending on your financial situation and loan product, you might be able to switch to a longer term or different type of mortgage – for instance, from an adjustable rate to a fixed term loan.
- Gain related benefits: If your property’s title insurance policy was recently issued, you might qualify for a reduced reissue or refinance rate. Additionally, depending on your loan type, how much you’ve paid off and payment history, you might be able to drop the cost of your private mortgage insurance (PMI).
If you’d like to determine whether refinancing for a lower rate will work for you, talk with one of our experienced loan consultants at (800) 210-8849.