Posted on: 13 May 2022
Homeownership is an important part of the American Dream for many people. But it's also a big responsibility. If you bought a house but now feel burdened by it, what can you do? Should you sell? Move to a different house? Try to tough it out? In fact, one simple step could help in a variety of ways: refinancing your current house. How might this help you? Here are four valuable ways.
1. Lower Your Mortgage Payment
Did you stretch your budget a little in order to buy the home? Perhaps your finances changed after becoming a homeowner. Whatever the reason, there's good news. Refinancing can permanently reduce your monthly mortgage payment. Both custom programs and standard loan options allow you to refinance in order to increase the term of the loan or save on monthly interest. This could make the loan manageable again.
2. Take Out Cash for Renovations
Is the house itself unsatisfying in some way? Buyers who bought in a tight market, bought a so-called starter home, or chose a fixer-upper may find that they have a house which doesn't really fit their needs. Solve this problem by doing a cash-out refinance. With this loan, you refinance for more than you owe and use the extra cash to complete needed renovations so you're happy with your home again.
3. Get Cash to Fix Budget Issues
Many Americans have other forms of debt than just a mortgage. These can cause budget burdens that bleed over into all areas of your home finances. A cash-out refinance could help you by paying off other debt or obligations, freeing up your budget. Paying off debt with a mortgage can be a very smart move as it nearly always results in lower interest rates and a longer payment term.
4. Remove Private Mortgage Insurance
Do you pay private mortgage insurance (PMI)? This added cost is mandatory for some buyers who borrow with just a small down payment. While PMI allows you to finance more than you could without it, it makes your payments higher. If you can refinance less capital than the PMI threshold, a new loan removes this added burden.
Where to Start
Want to know more about how refinancing your mortgage could make you happier with your home and feel less stress? Start by meeting with a custom mortgage lender in your state today. With their financial tools and expertise, you're sure to find a loan that will turn your home back into your American Dream.
Contact a mortgage lender for more information.Share