If you’ve had your home for a while and find yourself in need of a little extra cash, you might be wondering whether or not refinancing your home loan is the right decision for you and your family. Refinancing is a big decision and one that shouldn’t be undertaken lightly. However, if you are planning to refinance, here are a few things to consider…
What Type of Refinancing Do You Need
When refinancing a home loan its important to remember that there are many options available for your consideration. You might be searching for a Streamline Refinance of your existing FHA mortgage loan, or you might be needing to refinance from a conventional or other non-FHA mortgage into an FHA home loan. You might be looking to cash out or just trying to get a lower payment. Whatever the reasoning behind your desire to refinance, it’s important to choose the FHA loan product that’s right for your needs as an FHA Streamline has different rules and requirements than an FHA Cash-Out Refinancing loan option. That’s why it’s so important to partner with a mortgage lender who is up-to-speed on the latest loans and regulations so that you can make the best decision possible for your future.
What is Your Current Credit
Has the state of your credit changed at all since your original loan application? For example, if you’ve missed payments or have late payments on your credit record in the last 12 months, your credit may have been altered to reflect this behavior. If this is the case, you may want to wait to submit an FHA refinance application until you have a full 12 months of on-time, reliable payments on record. Borrowers who are refinancing in order to catch up on missed payments will need to discuss these circumstances in detail with the lender to see what type of refinancing options are available.
What are your Financial Goals?
When people choose to refinance, they often do so with specific financial goals in mind. Are you looking for lower payments? Do you want to refinance so as to make upgrade or improvements to the home? These questions are necessary in order to find the best options for you your goals. For example, if you’re wanting to refinance in order to make improvements to the home itself, you might want to consider an FHA Energy Efficient Mortgage. This “add-on” is a great option to consider for those wishing to remodel with the money provided from refinancing a home.
What is the Term of Your New Loan
15-year and 30 year loan packages are the industry standard FHA loan terms. In most cases, there should never be a penalty for paying off an FHA mortgage loan early, so if you choose a longer loan, you still have the option of paying it off early allowing you to plan a budget that doesn’t break the bank.
To learn more about refinancing your home and to find the option that’s right for you, contact our offices in Joplin, MO and schedule a consultation. We work with clients throughout the reason such as Pittsburg, KS, Springfield, MO, St, Louis MO and Kansas City and are certain we have an option that’s right for your needs.