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5 Questions About Refi Answered

Looking for lower monthly payments? Wish your mortgage had a lower interest rate? Want to consolidate your debt? Want to pay off your loan faster?

If you answered "yes" to any of the above questions, then you may be ready to refinance your mortgage.

5-questions-about-refi-answeredWhat does it mean to refinance my mortgage? 

Refinancing is just a fancy way to say that you'd like a new (and possibly better) mortgage payment. It sounds simple, but there are many things to consider. Work with Thrivent Federal Credit Union to make sure your refinanced mortgage meets the needs of your family and aligns with your overall financial goals.

What are the benefits to refinancing? 

If you purchased your current home with a high interest rate, and you have good credit history, refinancing your home to snag a lower rate could be for you. Advantages to refinancing include:

  • Securing a lower interest rate.
  • Locking in a lower monthly payment.
  • Consolidating your debt.
  • Paying off your loan faster.
  • Locking in new loan terms.
  • Eliminating private mortgage insurance.

What are some refinancing risks? 

Refinancing your home does come with risk. Not everyone looking to lower their interest payment will find success with refinancing. Discover some scenarios where you may want to avoid refinancing:

  • If your break-even point is too long.
  • If the long-term savings aren't significant.
  • If you can't afford the closing costs and are considering wrapping them into your monthly payment.
  • If moving to an adjustable rate mortgage puts you at risk when your payment increases.

How much will I really save? 

How long will it take to break even on a mortgage refinance? That depends on a multitude of factors including your current interest rate, the new potential rate, closing costs and how long you plan to stay in your home. Use this calculator to sort through the confusion and determine if refinancing your mortgage is a financial decision that aligns with your goals.

I need a lower interest rate. How much can I save in interest?  

How much interest can you save if you refinance your mortgage? This calculator helps you find out. Enter the specifics about your current mortgage, along with your current appraised value, new loan term, rate and closing costs. This will determine how much interest refinancing can save you. In addition, it will calculate the number of months to break even on closing costs with your reduced monthly payment. 

Topics: Home Buying & Selling

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