Facebook Twitter Instagram
    Mortgage.info
    • First Time Homebuyer
    • Loan Programs
    • VA Programs
    • Refinancing
    • Beyond the Mortgage
    Mortgage.info
    Home»Home Refinance Loans»Refinancing in 2017? Consider the 15-Year Refi Option
    Home Refinance Loans

    Refinancing in 2017? Consider the 15-Year Refi Option

    Chris HamlerBy Chris HamlerFebruary 15, 2017No Comments3 Mins Read
    Facebook Twitter Pinterest LinkedIn Tumblr Email
    Share
    Facebook Twitter LinkedIn Pinterest Email

    Refinancing in 2017? Consider the 15-Year Refi Option

    It may not be smart to refinancewhen mortgage rates are on the march, especially when you’ve got your original mortgage at a historically low rate. Should refinancing then be an off-limit for borrowers in 2017?

    Actually, there might be an exemption to this. If you have been paying your mortgage for many years, preferably close to halving your amortization time, refinancing to a shorter term, 15-year refi could make sense. This is even more beneficial if you are one of those homeowners who were able to increase their equity (and correspondingly, their loan-to-value ratio) because of the current rise in home prices.

    If you are currently carrying a 30-year fixed-rate mortgage, refinancing to a 15-year mortgage not only allows you to pay off your mortgage debt faster; it also gives you a lower interest rate.

    Interest on 15-year, fixed-rate mortgages are typically about 0.75 of a percentage point lower than that of 30-year FRMs. This may not seem like much but could amount to tens of thousands of dollars when calculated on account of the difference in amortization.

    »Click Here to get Matched With a Lender»

    The Benefits

    If you already have a 15-year mortgage as your original loan, it might be wiser to keep it. But if your mortgage runs on a 30-year amortization, refinancing to a 15-year mortgage have more chances of giving you the following benefits:

    • Getting rid of mortgage insurance. If you have 20 percent or more in your home equity, you can eliminate paying for a private mortgage insurance when you refinance.
    • Tapping into your home’s equity.As has been said, if you cash-out on your adequate home equity, you can use this money to increase your cash flow, fund for home improvements (and increase your home value), medical emergencies, or other unexpected expenses.
    • Consolidating debt.You may also use the proceeds of your cash-out refi to consolidate your credit card debts or use your equity to wrap your HELOCinto a single mortgage with a 15-year term.
    • Preparing for retirement.If you are approaching retirement and do not want your golden years to be burdened with the problem of debt, you can refinance to a shorter term and resolve your debt issues faster so you can settle into your retirement years with peace of mind.

    The Drawbacks

    Refinancing to a shorter term, 15-year mortgage may not be for everyone, however. Most of the time, a shorter refi could result to a higher monthly payment and may leave you less flexible to adjust to sudden tight financial changes. If you ever consider getting a 15-year refi, be sure that the resulting arrangement would be beneficial or at least manageable for you in the future.

    Find out today’s rates and contact us to get matched with a lender today.

    Chris Hamler
    + posts
    • Chris Hamler
      https://mortgage.info/author/chris-hamler/
      Mortgage Programs for First-Time Home Buyers
    • Chris Hamler
      https://mortgage.info/author/chris-hamler/
      So You Have a House Now. What Else Do You Need?
    • Chris Hamler
      https://mortgage.info/author/chris-hamler/
      Should I Cash-Out My Equity to Invest?
    • Chris Hamler
      https://mortgage.info/author/chris-hamler/
      How Will the New Tax Laws Impact Homeownership?
    15-year fixed-rate mortgage 15-year term HELOC Home Loan Mortgage mortgage refinance refinance
    Share. Facebook Twitter Pinterest LinkedIn Tumblr Email
    Chris Hamler

    Related Posts

    Don’t Overpay for Your Mortgage Refinance: Here’s How to Slash Your Costs and Save Big!

    November 22, 2022

    Should you Refinance your ARM into a Fixed-Rate Mortgage?

    November 5, 2022

    Cash-out Refinance for Extra cash: What you Need to Know

    October 31, 2022
    Mortgage.info
    © 2023 Mortgage.info Designed by ThemeSphere.

    Type above and press Enter to search. Press Esc to cancel.