You can make repaying your loan a lot easier when you refinance your jumbo loan to lower your interest rate. Jumbo loans usually are taken out for a longer time than other loans. This makes saving money down the road a bigger concern for those who have taken out these loans about 10 years ago. The amount of money borrowed with a jumbo loan means that refinancing it will come with certain requirements. Here are some things to consider to help you refinance your loan.
Before you talk to your current lender take a look at what other lenders are offering. This will give you a basic idea of what the going rates are. When you compare rates with other lenders you will also see where your current mortgage stands and how you can realistically save more money.
Refinancing will mean being charged a new set of fees, so you want to be sure that besides getting the cheapest rates that you are also saving money even though you have to pay these fees. Contact your lender and discuss your current financial situation and your refinancing plans with them.
See what costs are associated with refinancing with them. There are simple moves you can make to get a great rate on your refinances. Take a look at your credit score and do what you can to improve it in order to get a lower rate. Your lender can help you with this.
If you can refinance with your current lender it is the simplest way to refinance a jumbo loan because they already know your property and your payment history. It is still possible to shop for and find a better lender, though. Refinancing with your current lender means they don’t need to get a new appraisal of your property which will save you money.
Your lender may also be able to offer you a lower rate without the need for getting a completely new loan which can also save closing costs. Speak to your lender about your plans and ask what they can do to help you.
Refinancing extends the length of time in which you will pay off your loan so it is important to know exactly what part of your loan you want to refinance. Knowing this will help you understand how it will affect you in the long run.
If you are thinking of retiring in the next 10 years you want to make sure your pension covers the cost of your new loan. The same thing applies if you’re planning to start a family. If one of the spouses will stop working, will you have the money to handle the mortgage on top of daycare cost? Plan your future in order to establish if now is the right time to refinance.
You might consider a hybrid adjustable-rate mortgage. This is a good way to save money on the interest rate without having a 30-year commitment. It’s also a great option if you can see moving in the near future. A hybrid adjustable-rate mortgage begins as a fixed-rate loan with low-interest rates. This occurs for 10 years before it becomes adjustable.
This means that after a period of stable fixed rates your interest rate might get higher but and adjustable-rate hybrid mortgages great if you feel that you might need to change properties were refinance again in the near future. Hybrid mortgages do, with more risk than fixed rate loans. Talk to your lender or even your real estate agent before deciding if getting a hybrid adjustable-rate mortgage is right for you.
While it may take work to research whether or not it is right to refinance your jumbo rate mortgage right now, that work can pay off in terms of saving money in the future. It can also mean getting more freedom for the plans you have for your future.