Is Now the Perfect Time for a Home Loan Refinance?

Is now the perfect time for a home loan refinance? Take it from the top San Diego home loan company, you might have a better shot at mortgage refinancing now than you’ve had before.  While it’s true that refi rates have risen over the last few months, those higher prices could be seen as the perfect opportunity for the savvy home buyer.

when-to-refinanceHow so?  Well, because the demand is falling lenders are now scrambling to find as  much business as they can during this dry spell.  That means that if you were turned down for a refi as little as a few months ago, you might try again now — lenders could be much more willing to take another look at your profile this time around.

There might be an overlay before we reach our destination

Now, we’re not saying that everything’s coming up roses for borrowers — mortgage standards are still pretty tight compared to where they were before the real estate market crash.  And the Fannie Mae and Freddie Mac official mortgage guidelines haven’t gotten any more lax, either.  There is one area where borrowers might catch a break, though: overlays, or the guidelines that each individual lender has in place, in addition to Fannie and Freddie’s rules.

Now, while refi applications are becoming more scarce, some lenders are rethinking their own overlay requirements; many going so far as to give less qualified borrowers — who they might’ve turned away a few months ago — another, more serious consideration.

Hope your credit’s (now) up to par

Another reason you may have been turned down for a home refi in the past could have to do with your credit profile.  Give it another look now and, assuming you’ve taken steps to repair your report like paying your bills on time and such, you could be looking at a much rosier score.

Remember that your credit profile changes on a weekly (sometimes daily) basis, so if your lower credit score was a reason lenders turned your away, spending those intervening months working to repair it could be the boost you needed.

Wanna see if you’re ready for your own home refi?  We’ve got a whole team ready to work for you!

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Refinancing Your Loan With An Adjustable Rate Mortgage

Refinancing your loan with an Adjustable Rate Mortgage is a viable option. One thing we always like to stress to people who are looking to refi their San Diego home loans is to consider all possible advantages they might take in helping them get that refi’ed rate — in particular, the advantages of ARM.

refinance-adjustable-rate-mortgage

Short for Adjustable Rate Mortgage, ARMs might not be as popular an option for some homeowners as fixed-rate mortgages — due in no small part to their low interest rates — but they do offer unique advantages all their own as well, which we’ll be covering today.

Friends, lend me your ARMs

Right of that bat, it’s important to note that ARMs typically offer some of the lowest mortgage rates around.  They’re able to do this because ARMs only lock your rate in for a limited time — usually over 5 to 7 years at a time.  Once that initial period comes to an end, the rates will then be reconfigured based on current mortgage market conditions.

Because of this, ARMs are generally sought out (and make the most sense for) borrowers who are only looking to stay in their home for a shorter period of time than most others would.  If you aren’t looking to stay in one place for more than, say, 5 to 10 years, an ARM may be the best way for you live comfortably with a lower rate.

Pay it down quicker

Maybe the low rates of a 15-year fixed mortgage look enticing to you, but the promise of larger monthly payments has been enough to hold you back from signing the papers?  An ARM might just be the thing for you.  Since they offer much lower monthly mortgage payments, borrowers that choose this option have the flexibility of paying down their loans quickly and making smaller payments if necessary.

On average, the minimum monthly payment borrowers who go with ARMs can expect is around 60% of what you’d pay on a 15-year fixed mortgage.  Choosing to pay the extra 40% a month on an ARM for the next 15 years can cut the mortgage principal by nearly half of what it was.

Interested in finding out if an ARM is the right plan for you?  Find out more and contact us today.

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