Currently mortgage rates are at the lowest they have ever been, since mortgage rates have been monitored. Many people are looking to refinance and I wanted to point out 8 great reasons to do it.
- Cut the Length of your Mortgage- With 15 year mortgages being at an all time low of 3.75%(at the time of writing) now is the best time to reduce the term of your mortgage. If you have a 30 year mortgage it is worth looking into reducing your term to a 10, 15 or 20 year mortgage. You may be able to reduce your length and keep your payment the same as your current 30 year mortgage.
- Lower Your Rate- Since rates are at their lowest it is worth looking into refinancing to get a lower rate. This will reduce the amount of interest you pay over the length of your mortgage
- Convert your Arm into a Fixed rate- Your rate maybe an ARM( adjustable) rate and adjusting soon. If that is true, it is in your best interest to refinance into a fixed rate. Even if your rate is not going to adjust soon, you will still want to look into refinancing into a fixed rate. It is safe to say this is the lowest rates will ever be, so why gamble on what your rate will be once your ARM rate is set to adjust.
- Pay off Other Debt- You can refinance your mortgage and also take out cash at the same time. In Texas, you can take out a "cashout" mortgage for up to 80% of your home value. You can use this extra money to pay off credit cards with higher interest rates, pay for college, home repairs, etc.
- Use your Home equity to buy another property- You can also refinance your mortgage to take out cash and buy an investment property or maybe a vacation home. Or use this cash to put as a down payment on a new home.
- Consolidate Two Mortgages into One- If you have two mortgages, look into refinancing it into one. Second mortgages always have higher rates, so by combining them into one loan you can reduce your total mortgage payment.
- Divorce- Are you going thru a divorce? Instead of selling the home and dividing the profits, looking into taking cash out of the property to pay off the other party. Divorce is hard enough without having to sell your dream home.
- Remove Mortgage Insurance- Mortgage insurance many times is NOT tax deductible. So you will want to look into your options of refinancing into an mortgage that allows you to avoid mortgage insurance. Maybe refinance into two mortgages, so that the mortgage total interest is tax deductible. Giving you a better mortgage.
If you are thinking of refinancing your home, call me today so that we can find the best mortgage option for you!
David Krichmar
Mortgage Banker NMLS#293883
Weststar Mortgage Corporation #93243 dba Core Lending
Has Written For Realtor Magazine, Houston Agent Magazine, Scotsman Mortgage Guide
Approved MCE Instructor
Office:832-689-6012
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Good info Dave. I'm refinancing a rental property I have now.