Benefits of a Refinance

Your Intercap Loan Officer will help you understand the options and benefits of a refinance.

01

Lower Payments

Lowering your monthly mortgage payment is one of the top reasons homeowners opt for a refinance. There are a few ways a refinance can accomplish this.

  • Lower interest rate – A lower interest rate could lower your monthly mortgage payment by tens to hundreds of dollars. The interest rate is determined by current market rates as well as any pricing conditions at the time of the purchase. For example, your credit score, loan-to-value percentage, and debt-to-income percentage can affect your interest rate. After owning your home for several years, you may be able to qualify for a lower interest rate even if the market rates have gone up. Your Intercap loan officer can let you know when you are in a good position to lower your interest rate and monthly mortgage payment enough to consider a refinance.
  • Remove mortgage insurance (MI) – Some home loans require mortgage insurance that can add an extra cost to your monthly payment. This MI requirement is usually based on a high loan-to-value percentage. Over the years, your home may have appreciated enough to qualify for a refinance that doesn’t require this mortgage insurance. We can help you determine your home’s current value and how much a refinance could save you in your monthly mortgage payment.
  • Lengthen the loan term – If lowering your monthly mortgage payment is important for your current budget, you may be able to apply for a refinance that adds more years to your loan. For example, if you have owned your home for ten years you could refinance to a new 30-year loan with a lower monthly payment.

Each of these options have pros and cons based on overall loan costs and benefits. Your Intercap Loan Officer is committed to helping you make the best informed decision.

Find out how much you could gain from a refinance.

“Not only did I save over $300 month on our re-fi our Intercap loan officer was professional, on top of it and a pleasure to work it!”

– Reviewed by Haley Del Andrae

02

Improve Rates and Terms

  • Refinancing to a 15 or 20-year loan could save you tens to hundreds of thousands of dollars in interest over the life of your mortgage. Not to mention the ability to pay off your home sooner.
  • Converting an FHA loan to a Conventional loan could improve the loan terms and monthly mortgage payment.
  • Combining a first and second mortgage could lower the overall monthly mortgage cost and interest payments.

03

Get Cash Out

Over the last 40 years homes appreciated across the United States at an average of 4.2% per year, and much higher in some areas. Each region, county, and property are unique so you will need an appraisal to determine the current value of your home. Your mortgage payments have also contributed to lowering your principle balance. The spread between your home’s appreciation and the principle pay-down is your equity. A cash-out refinance allows you to tap into some of this equity – usually up to 80 percent.

Your Intercap loan officer can help you determine how much equity you have and how much you can take out through a cash-out refinance. You can use this money to make improvements on your home and/or to pay down debt. A cash-out refinance will likely increase your monthly mortgage payment but there are some cases where a new loan provides a better rate and terms to minimize the added costs of this type of refinance.

A debt-consolidation refinance can actually help you pay off your home and debt in record time. Many are paying off their home in 10-15 years or less. The secret is using your home equity and monthly savings to pay off your home quicker. Click here for more information about a debt-consolidation refinance.