October 7, 2019
When interest rates drop, homeowners generally begin to wonder “should I refinance my existing mortgage”? Depending upon the individuals’ current situation, as all of us are unique, there are a handful of existing scenarios that may beneficial to a homeowner. Orion’s brokers are skilled at refinances, and have seen many reasons why their clients, old and new, pay off their old loan and put a new one on their property.
The most obvious reason to refinance is to obtain a lower rate. The Fed has lowered rates in the United States, is expected to do so again at its next meeting this month, and foreign economies are not doing well. In a lot of cases, a lower rate can save your client a great deal of money in the long run. If their current mortgage loan includes private mortgage insurance, refinancing may be a seriously good idea. Refinancing to a shorter-term mortgage, if their finances allow, enables them to pay-off their home sooner. Houses in most areas have appreciated, and mortgage insurance may no longer be necessary, resulting in a nice monthly saving.
Homeowners can also consider utilizing a “cash-out” refinance to achieve a variety of goals. Some examples include allowing for the pay-off other high interest rate debt or an existing 2nd mortgage. The consolidation of student loans, removing a co-signer or to pay-off an ex-spouse or business partner in a lump sum.
Orion has done many adjustable rate loans in recent years. If your client’s existing home loan is an ARM loan, refinancing to switch from an adjustable rate to a fixed rate mortgage or to reset the term on their adjustable rate mortgage is also a viable reason to refinance.
Using the existing equity in your client’s home can be used to open-up cash flow enabling them to help finance a 2nd home or vacation home, invest in a business, finance the down payment on a rental property, or perhaps use the cash-out proceeds to renovate their current home.
As a homeowner, taking advantage of lower interest rates may be the answer to accomplish your client’s goals previously left on the back burner. If a client comes to you and mentions that they have been contemplating refinancing their home, Orion has plenty of programs and the customer service to help you help them. Talk to an AE here at Orion to learn the facts and options for unique situations that you may encounter.