For this Monday market report we have invited a guest blogger to fill you in on the mortgage industry and a buzz worthy topic in today’s market. Refinancing has always been around in the mortgage business; but in more recent years most homeowners have not been able to take advantage because they are underwater on their homes.
Recent programs such as HARP 2.0 and the Streamline FHA Refinance are designed specifically to help those underwater homeowners. Finally first-time home buyers are not the only people taking advantage of the historically low interest rates in today’s market. Often times with these new programs you are able to refinance without even ordering an appraisal!
Michelle Knight of Integrity Home Loans shares with us how refinancing your current mortgage can help you:
Sr. Loan Officer
Integrity Home Loan of Central Florida, Inc.
708 E Colonial Dr. Suite 203
Orlando, FL 32803
“There are several reasons why refinancing your existing mortgage could be beneficial. The most common reason is to lock in a lower interest rate on your loan. Others refinance in order to switch from an adjustable-rate loan to a fixed-rate loan (or vice-versa), to stop paying private mortgage insurance (PMI), or to cash out of your home’s equity.
Individuals planning to sell their home within 3-5 years can save hundreds of dollars per month by switching from a fixed-rate to an adjustable-rate mortgage (ARM). ARMs average around two percentage points less than fixed-rate loans. At today’s rates that can mean BIG savings – mortgage industry experts forecast that rates will likely remain under 4 percent until mid-2013.
Be cautious though, I only suggest switching to an ARM if you have a qualified mortgage professional who can explain how the program applies to your unique situation. Specifically speaking, at what time your payment can adjust and the maximum it can increase.
To decide if refinancing is right for you research the costs; including points, transaction fees, and closing costs. Compare your new payment amount with your current payment and figure out how long it will take you to recover the costs. It may not be cost effective if you plan to stay in the home for less than 3 years.”
Thanks to Michelle for guest blogging today! For more information on refinancing your Orlando home or to discuss your unique situation please feel free to contact Michelle at 321-663-2795. Or if refinancing is not for you, contact us to learn more about selling your home in Orlando or Winter Park at 1-800-859-5714.