4 Reasons Why You Should Consider Refinancing Your Colorado Mortgages
Many homeowners in Colorado are tempted to refinance their mortgages due to the ever-falling interest rates. Interest rates have been low for the past few years and they could rise again at any time, so if you are considering refinancing your mortgage, you might want to act sooner rather than later. Most people refinance their mortgages every four to seven years to reduce their monthly interest rate and in turn, reduce their loan duration. For instance, you may consider changing to a fixed rate home loan if you are currently on an adjustable rate. Fixed rates enable you determine your monthly payments rather than a fluctuating payment. Is it possible to refinance your mortgages in Colorado? The answer is pretty simple; if your plan is to reside in your current home for a long period of time then it is a wise decision to refinance your mortgage. It does not matter if you bought or refinanced the house recently, you can refinance at any time — for any reason. However, refinancing calls for commitment as it is not recommended to refinance if you are planning to sell your house anytime soon.
Benefits of Refinancing Your Mortgage
Reduction of Interest Rates The reduction of your interest rate, and therefore the reduction of your monthly payment, is one main reason why you should consider refinancing. With the help of your lender, you can determine if interest savings accrued can help you pay back the refinanced loan more quickly. This decrease in your interest rates can save you a significant amount of money in the long run. Cash Withdrawal If you are in need of money for college tuitions, home repairs or improvement or to consolidate your bills, then consider refinancing. Interest Rate Type Change If you have an adjustable rate mortgage then you should consider changing to a fixed rate since with adjustable rates any change in the interest rate will call for an increase in payment. With a fixed interest rate, your monthly payment stays the same allowing you better control over your finances. Shortening of Mortgage Duration You can also refinance to shorten the term of your mortgage-especially when you can also lower your interest rate. The decrease in the interest allows you to pay off your loan in a quicker duration then you would have originally. If refinancing is an idea that you have been playing around with, take a look at our calculators that can help. The Interest Savings calculator is a great tool to start with as it will look at your long term savings if you choose to finance.