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Mortgage Refinance

With today’s low interest rates, it's a great time to refinance.

A mortgage refinance simply replaces an existing home loan with a new one.

Here’s how it works:
When you buy a home, you get a mortgage to pay for it. The money goes to the home seller. When you refinance, you get a new mortgage. Rather than the funds going to the home’s seller, the new mortgage pays off the balance of the old home loan.

Just like you had to meet the lender’s requirements for the original mortgage, again you need to apply and qualify for your new loan.

Before you get started, decide on your objective:

Reduce the monthly payment.
To pay less each month, you can refinance into a loan with a lower interest rate or extend the loan term. However, when you extend the term, you pay more interest over the length of the loan.

Tap into your equity.
With a cash-out refinance, you can borrow more than you owe, and receive a check for the difference. It’s often possible to get a cash-out refinance and a lower interest rate at the same time.

Shorten your term.
When you refinance from a 30-year mortgage into a 15-year loan, you pay off the loan in half the time, which means you pay less interest over the life of the loan.  Depending on your rate and amount of equity, your payment may stay the same or go up slightly, but it’s important to focus on the overall savings if you intend to stay in the home.

Eliminate FHA mortgage insurance.
Private mortgage insurance on conventional home loans can be canceled, but the Federal Housing Administration mortgage insurance premium (MIP) often cannot. To get rid of FHA mortgage insurance premiums you must either sell or refinance when you have accumulated enough equity.

Switch from an adjustable to a fixed-rate loan.
A fixed-rate loan removes the risk of higher payments in the future.

There are pros and cons with regards to refinancing a mortgage.  We'd love to help determine if this is right for you. For more information on refinancing your home, contact Sue Meitner today at 215-469-1000.

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Susan Meitner
NMLS#147160 / PA#28941
NMLS Company – 130562 Branch 1814379

NMLS Consumer Access website

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Sue Meitner - Centennial Lending Group
1126 Horsham Road
Maple Glen, PA 19002