Know Your Interest Rate and When It Might Be Time to Refinance
Do you know the interest rate on your current mortgage?
When you originated the loan, you may have given it some thought, making sure you got the best rate available to you given your credit score at the time, work and rental history, and the current market. Or maybe you took advantage of a lower rate with an ARM (adjustable rate mortgage), because you were newly employed, or your credit score wasn’t what you wanted it to be.
Do you know the current rate for a 15 year fixed mortgage? A 30-year mortgage? Do you know how much you still owe on your home and how much you will pay in interest over the life of your mortgage?
No? Take a minute, go to your lender’s website—or do it the old-fashioned way and call them—and get those numbers.
If the current rates are better than the one you got when you originated the loan, or if your work history or improved credit score has given you access to better rates, it may be time to consider refinancing your home.
If your income has increased, and you started with a 30-year mortgage, you may be ready to pay a little more each month (it may be less than you think) and take advantage of the lower rates of a fifteen-year mortgage.
Bonus: wouldn’t it be exhilarating to pay off your loan years before you thought you would?
The best way to take advantage of lower rates in any given market is to know where you stand and keep an eye out for market trends.
Take a few minutes and run the numbers (our refinancing calculator is a great place to start). Are you in the right place or is it time to consider refinancing?
PS: If you're a veteran, and have recently gone through a divorce, refinancing can be tricky. Get the lowdown accessing our handy step-by-step guide here.