The time is right now to bag an impossibly low rate on your mortgage refinance. Mortgage rates are at their all time best lowest levels. Refinancing your mortgage can slash your monthly payment and your total interest costs, as many homeowners have learned and taken advantage of in 2020. It just might be worth your while to replace your current home loan — even if you’ve had it as recently as last year.The 5 Reasons You Should Refinance Your Mortgage Right Now

Reason #1

Your current mortgage rate is over 4%

Average rates on 30-year mortgages have been holding at around 3.29%, the record low reached last month in the popular weekly survey from mortgage company Freddie Mac. This is a lot different from a year ago, when borrowers were typically getting rates of over 4.1%. A recent Lending Tree study found that homeowners who refinance home loans that were taken out in early 2019 could save approximately $60 a month for every $100,000 borrowed. The average lifetime interest savings would add up to about $20,000. That’s a substantial amount of money saved!

Reason #2

Your credit is in excellent shape

The very best mortgage rates are reserved for borrowers with stellar credit. Credit scores range from 300 to 850, and to land a low rate you’ll need a score that’s exceptional at 800 or higher or at very good from 740 to 799. If you haven’t looked at your credit score in ages, now would be the optimum time to do so. Lenders also measure your debt-to-income ratio — the percentage of your monthly income (before taxes) that goes toward paying down your debts, including student loans and credit card balances. The lower your “DTI” is the better, to get the lowest rate. Mortgage lenders are more inclined to prefer borrowers with debt-to-income ratios that are under 36%.

Reason #3

You plan to stay in your home

A refinance into a loan with a lower rate will truly save you money if you plan on remaining in the home long enough to more than claw back your closing costs.

Let’s say your new loan reduces your monthly payment by $100. That’s $1,200 a year. If you have to pay $5,000 in closing costs, it’ll take you more than four years to recover that expense through your refinance savings.

Reason #4

You’re ready to protect your investment

Your home is a huge financial investment, and another way of protecting that investment is with life insurance — so that your family will still be able to make the mortgage payments and stay in your home in the event that something ever happens to you. Life insurance also is surprisingly affordable. Depending on your age and the community where you live, you might be able to get $1 million in coverage for as little as $7 a week. You can quickly and easily compare policies and find the one that best meets you and your family’s needs.

Reason #5

Paying off your loan won’t cost you anything

Before you take steps to lock in a refinance mortgage, look for the “fine print” on your current mortgage to be certain that there’s no penalty for pre-payment.

Some mortgages will charge you a fee if you pay off the loan early; specifically during the first few years of the mortgage refinance agreement. These prepayment penalties are rare, but if your loan has one you might take a hit for thousands of dollars. Or worse, you may have to pay a lump sum or a percentage of the balance left on your mortgage upon prepayment. These fees tend to be on interest-only mortgages and other less conventional loans. Prepayment penalties can be financially painful, so it’s something else to keep in mind as you compare rates and terms while looking for the perfect mortgage for your refinance.

  • Single family
  • Primary Residence and Second Homes Only
  • 720 Minimum credit score
  • $510000 Max Loan Limits
  • Full Income Check

Contact one of our loan consultants to learn more about this program.

Have questions or need help?

Call us now at 800-220-LOAN

Request a call back or email us your questions!

Get Started

No obligation quote