Unlock the Benefits of Mortgage Refinancing

Get Pre approved today

Unlock the Benefits
of Mortgage Refinancing

Get Pre approved today

Refinancing Benefits

One of the primary reasons homeowners refinance is to secure a lower interest rate. By refinancing to a loan with a lower rate, you can potentially save a significant amount of money over the life of your mortgage.

Refinancing to a lower interest rate or extending the loan term can result in lower monthly mortgage payments. This can free up cash flow, making it easier to manage your monthly budget or allocate funds to other financial goals.
If your goal is to pay off your mortgage faster, refinancing to a shorter loan term, such as from a 30-year to a 15-year mortgage, can help you build home equity more quickly and save on interest payments.
 With a cash-out refinance, you can tap into your home’s equity by borrowing more than your current mortgage balance. This cash can be used for various purposes, such as home improvements, debt consolidation, education expenses, or other financial needs.
 Refinancing can provide an opportunity to consolidate high-interest debt, such as credit cards or personal loans, into your mortgage. By rolling these debts into your mortgage, you may benefit from a lower interest rate and a single monthly payment, simplifying your finances.
Refinancing allows you to switch from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage or vice versa. This can provide stability and predictability in your monthly payments or take advantage of potential interest rate savings.
If you initially obtained your mortgage with less than a 20% down payment, you may be paying for private mortgage insurance. Refinancing when your home’s value has increased or you’ve paid down a significant portion of your mortgage can help remove the requirement for PMI, saving you money.
Refinancing can provide financial flexibility by restructuring your mortgage terms to align with your current financial situation and goals. This can help you better manage your finances, reduce stress, and improve your overall financial well-being.

Refinance Loan products

Rate-and-Term Refinance

This type of refinance loan allows you to change the interest rate or term of your mortgage. It is typically done to secure a lower interest rate, reduce monthly payments, or adjust the loan term

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Cash-Out Refinance

With a cash-out refinance, you borrow more than your current mortgage balance and receive the difference in cash. This can be used for various purposes such as home improvements, debt consolidation, or other financial needs.

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Jumbo Refinance

If you have a high-value home that exceeds the conforming loan limits, a jumbo refinance loan allows you to refinance your mortgage while maintaining a loan amount above those limits.

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VA Interest Rate Reduction Refinance Loan (IRRRL)

Exclusive to eligible veterans, the VA IRRRL allows you to refinance an existing VA loan to obtain a lower interest rate. Similar to the FHA Streamline, it offers a simplified process with reduced documentation.

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Adjustable-Rate Loans (ARMs)

With an ARM, the interest rate is initially fixed for a specific period, typically 5, 7, or 10 years, and then adjusts annually based on market conditions. ARMs generally offer a lower initial interest rate but can increase over time

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Interest-Only Loans

These loans allow borrowers to pay only the interest portion of the loan for a specified period, typically 5 to 10 years. After the interest-only period, the loan converts to a traditional principal-and-interest payment structure.

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Refinancing

Frequently Asked Question

 
Mortgage refinancing is the process of replacing an existing mortgage with a new one. It involves obtaining a new loan with different terms and using the funds to pay off the original mortgage.
People refinance their mortgages for various reasons, including:
   – To obtain a lower interest rate and reduce monthly payments.
   – To switch from an adjustable-rate mortgage (ARM) to a fixed-rate mortgage for more stability.
   – To access the equity in their home for renovations, debt consolidation, or other financial needs.
   – To shorten the loan term and pay off the mortgage faster.
   – To remove a co-borrower or add a new one.
   – To remove private mortgage insurance (PMI) once enough equity has been built.
When you refinance a mortgage, you apply for a new loan, just like when you initially bought your home. The lender will assess your creditworthiness, income, and other factors to determine if you qualify for the new loan. If approved, the new loan proceeds are used to pay off the existing mortgage, and you start making payments on the new loan.
Refinancing typically incurs closing costs, which can include loan origination fees, appraisal fees, title search and insurance fees, attorney fees, and other miscellaneous expenses. These costs can vary depending on the lender and the loan amount. It’s important to factor in these costs when considering refinancing to determine if the potential savings outweigh the expenses.
Deciding whether to refinance depends on several factors, including the current interest rates, your financial goals, how long you plan to stay in your home, and the costs associated with refinancing. It’s advisable to calculate the potential savings by considering the new interest rate, loan term, closing costs, and how long it will take to recoup the costs through lower monthly payments.
Having bad credit may make it more challenging to qualify for refinancing, but it’s not impossible. Lenders may have different requirements, and some specialize in working with borrowers with lower credit scores. However, having a higher credit score generally improves your chances of getting better loan terms and interest rates.
The refinancing process typically takes anywhere from 30 to 45 days, but it can vary depending on several factors, such as the lender’s efficiency, the complexity of your financial situation, and the documentation required. It’s advisable to start the process well in advance and be prepared to provide the necessary paperwork promptly to expedite the process.

Pre-qualification is an initial assessment based on basic information provided by the borrower. It gives you an estimate of how much you may be able to borrow. Pre-approval is a more detailed process where the lender verifies your financial information, creditworthiness, and determines the specific loan amount you qualify for. Pre-approval carries more weight and can strengthen your position as a buyer.

Refinancing when you owe more than your home’s value, often referred to as being “underwater” or having negative equity, can be challenging. However, certain government programs such as the Home Affordable Refinance Program (HARP) may assist homeowners in these situations. It’s best to consult with lenders or mortgage professionals to explore the available options.
Refinancing can have a temporary impact on your credit score. When you apply for a new loan, a hard inquiry is typically made on your credit

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“The content provided within this website is presentedfor information purposes only.  This is not a commitment to lend or extend credit.  Information and/or dates are subject to change without notice.  All loans are subject to credit approval. As a result of refinancing, your total finance charges may be higher over the life of the loan. Other restrictions may apply.”

Lending Pros LLC | 12 mile rd. Suite 340 Southfield MI 48034  | NMLS# 2373501 | www.nmlsconsumeraccess.org

  • Dominic@lendingprosmtg.com
  • (248) 223-7800 ext 101
  • 24725 W. 12 mile rd. Suite 340 Southfield MI 48034