Home Refinance Rates from First Bank
With the country’s average interest rates for 30-year fixed mortgage rates currently at their lowest, now is a good time to consider refinancing your home. Low home refinance rates mean U.S. homeowners are able to have lower monthly payments, more cash in their pockets, or both.
How Does Refinancing Work?
Simply put, you use a new mortgage to pay your original mortgage in full, leaving you with just the “new” mortgage on your home. Even if the terms and interest rates for the new and original loans are different, the property securing the loan is the same.
Should you Refinance Now?
With interest rates at near historic lows, many mortgage experts are saying, “if you’re going to refinance, do it now.” If you’re unsure, then consider U.S. News & World Report’s three reasons to refinance now:
- Low Interest Rates—While it is possible that interest rates will start to climb again, it doesn’t necessarily mean it will happen soon. So, why not take advantage of current low interest rates? Refinancing is like getting a second or third chance you wouldn’t normally get in most other situations.
- The Cost of Mortgage Insurance has Decreased—With the Federal Housing Administration reducing mortgage insurance premium rates, new homebuyers and homeowners looking to refinance could save $900 on average.
If you have an FHA loan, you may be able to remove your mortgage insurance payments altogether by refinancing from an FHA loan to a conventional mortgage.
- The Value of Your Home May be Higher—Though home values have dropped over the years, they’ve recently made a comeback, meaning you are probably in a pretty good position to refinance today.
Although many homeowners are in a better position to refinance now, there are still some issues that might restrict homeowners interested in refinancing.
- If you’re credit score or credit history needs improvement, lenders may be hesitant to work with you to refinance your home.
- While refinancing your home can save you money, those rates are separate from the amount of cash needed to complete new deal due to closing costs. These closing costs generally run around 2-5% of the purchase price of your home. This extra cash is an important factor to consider if you’re contemplating home refinancing.
Is refinancing right for you?
While refinancing may be a good option for many homeowners, it’s not necessarily the case for all families or individuals. Before making any major financial decisions about your mortgage loans, use our calculator to find out if refinancing is a good option for you. If you’re interested in learning more, contact one of our loan officers to set-up a consultation at a First Bank branch near you today.*
*Loans subject to credit approval.