Skip to main content
_FB_2018-Icons-finalized-cleaned-up_new_FB_2018-Icons-finalized-cleaned-up_newGroup 9
Back
Scroll to top

Five Reasons to Refinance Your Mortgage


Banking professionals suggest mortgage refinancing when homeowners want to replace their current loan with a new one, often to reduce monthly payments or lower interest rates. With a mortgage refinance, your current loan is paid off and replaced with a new one. This can be a great option for borrowers with good credit who want to alter their current loan. Refinancing could be risky for borrowers with less than perfect credit.

Check out our list of reasons to refinance and see if you could benefit from refinancing your current mortgage.

5 Reasons to Refinance

  1. Lower interest rates—If mortgage rates have dropped since you first took out your loan, you could secure a lower rate by refinancing.
  2. Lower monthly payment—Lowering your interest rate could have a dramatic impact on your monthly payment. If you intend on staying in your home for several years, lowering your payment could help you save.
  3. Shorten loan term—When interest rates fall, homeowners can often significantly shorten their loan term by refinancing without much increase in their monthly payment.
  4. Convert between adjustable-rate and fixed-rate—With adjustable-rate mortgages, your initial interest rate may be low and and then increase over a period of time. Refinancing to a fixed-rate mortgage could allow you to avoid an increase in rate.
  5. Cash out to make a large purchase—If you have equity in your home, refinancing enables you to cash out on that equity without taking out a loan, such as a home equity loan. A lot of people will use this cash to pay for home repairs, college tuition, or make a large purchase, such as a car. These types of refinances are typically easy to complete and may even be tax deductible.

If you still aren’t sure if a mortgage refinance is right for you, visit our online refinance calculator to see how much you could save, or visit your local First Bank branch to speak with a mortgage specialist.


Loans subject to credit approval.

———
Sources:
http://www.mortgagecalculator.org/helpful-advice/what-is-a-refinancing.php
http://www.investopedia.com/articles/pf/05/033005.asp

Trending Topics

What is Personal Finance?

Are you ready to get a handle on your finances and prepare for your future? The first step is understanding personal finance. According to Investopedia, "Personal finance defines all financial decisions…

Is It Possible to Get a Mortgage Refinanced with No Closing Costs?

When it comes to refinancing a mortgage, you need to spend money to save money. Closing costs can amount to thousands of dollars, depending on the home loan. This is…

Personal Finance Articles & Advice | First Bank

Looking for advice on how to better manage your finances? First Bank's* collection of personal finance articles can help you with every aspect of managing your funds, from saving money to…

First Bank is One of the Top Banks in the U.S.A.

When searching for the top banks in the U.S., it is often smarter to work with a small community bank over a national bank like Wells Fargo or Bank of…

Mortgage Rates 101: Information You Should Know

Acquiring information about mortgage rates is a vital step in the home buying process. Mortgage rates vary based on several factors, such as the amount and type of your loan…

FHA Loans vs. Conventional Loans: How to Tell the Difference

Overwhelmed with the prospect of buying a home? FHA loans and conventional loans are likely two sources of financing that you’ve considered. Let First Bank help you understand these options…

What is Overdraft Protection?

According to Investopedia, an overdraft is "an extension of credit from a lending institution when an account reaches zero." An overdraft allows the individual to continue withdrawing money even if…

Jumbo Home Mortgage Loans

If you are thinking of buying a home with a higher property value and can handle larger monthly mortgage payments, a jumbo loan could be a suitable option for you.…

How To Make A Budget

The best way to save money and gain control over your finances is to make a budget. Follow these simple steps to make a budget that will save you money…

Open a Banking Account Online at First Bank

The ability to manage bank accounts online has provided us with financial freedom like never before. Consumers may now make payments, transfer funds or make deposits straight from a computer…