Refinancing

Phoenix Arizona Mortgage Loans often refinances to lower interest rates. If rates have dropped since you last financed your home, you should think about refinancing.

Refinancing

Common reasons to refinance include paying off a balloon payment, converting an adjustable rate loan to a fixed rate, get cash out. A few reasons for cashing out include: home improvement, an education fund, and consolidating debt.

Refinancing & Home Equity Loans

Another way Phoenix Arizona Mortgage Loans converts equity in your home to cash is a "home equity" loan. A "home equity" loan is an alternative to refinancing if your home loan has a very low rate compared to current interest rates or if you have a prepayment penalty on your loan.

In order to refinance you will need a current appraisal, analysis and in many cases verification of your income and assets, as well as most of the same paperwork required when you originally financed your home. Adequate property insurance and new title insurance is necessary.

Refinancing with Phoenix Arizona Mortgage Loans can help if:

• You want to get out of a high interest rate loan to take advantage of lower rates. This is good only if you intend to stay in the house long enough to make the additional fees worthwhile.
• You have an adjustable-rate mortgage (ARM) and want a fixed-rate loan to have the certainty of knowing exactly what the mortgage payment will be for the life of the loan.
• You want to convert to an ARM with a lower interest rate or more protective features than the ARM you currently have.
• You want to build up equity more quickly by converting to a loan with a shorter term.
• You want to draw on the equity built up in their house to get cash for a major purchase or for their children's education.

Should You Refinance Your ARM?

In deciding whether to refinance an ARM you should consider these questions:

• Is the next interest rate adjustment on your existing loan likely to increase your monthly payments substantially?
• Will the new interest rate be two or three percentage points higher than the prevailing rates being offered for either fixed-rate loans or other ARMs?
• If the current mortgage sets a cap on your monthly payments, are those payments large enough to pay off your loan by the end of the original term?
• Will refinancing to a new ARM or a fixed-rate loan enable you to pay your loan in full by the end of the term?

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