Refinancing
A refinance replaces the loan you already have. It can change the term, or it can turn equity into money you pay back. It is not the same choice for every homeowner.
Ways People Use a Refinance
Swipe sideways to see each path.
Rate and Term
Replace the current loan to change the rate, the length, or both. A shorter term can raise the payment and reduce the interest you pay over time.
Cash-Out
Replace the loan with a larger one and receive the difference as cash. That cash is borrowed. The home's value has to support the new loan size.
Streamline
Some existing FHA and VA loans can be refinanced with a shorter file when you are not taking cash out. It still has costs, and it is not available on every loan.
Reverse Mortgage
Homeowners who are 62 or older, and in some cases 55 or older, can look at a reverse mortgage. You keep the title. You still pay taxes, insurance, and upkeep.
Run the Break-Even First
1
Add the Costs
Closing costs are part of the math. A lower payment has to cover them before it helps.
2
Compare the Payments
Break-even is how long a lower payment needs in order to cover those costs.
3
Ask How Long You Will Stay
If you expect to move before then, a lower payment may not help.
The refinance calculator uses numbers you enter. It is an illustration, not a quote or an offer.
A Real Conversation
Ready When You Are.
Talk with a loan officer who is licensed where the home is. Walk through buying, refinancing, or a loan that does not fit a standard file. Start with the directory, or answer a few questions first.