Are you considering refinancing your Lafayette home? Read our latest blog on Lafayette home refinance to find out if it’s a good idea or not.
It’s no secret that the housing market has been remarkable over the past two years, with competitive bidding and shortlisting periods making it a great time to sell your home. On the other side of that coin, one of the benefits of being a home buyer in this market has been the opportunity to enjoy notably low mortgage interest rates. Corrected housing prices, tighter credit standards, and a declining number of unsold homes have kept interest rates at historic lows from 2013 until 2021, but now interest rates are beginning to rise again for the first time in 8 years. News of rising interest rates can feel discouraging for those who have been preparing to enter the competitive housing market and for current homeowners who are hoping to refinance their homes.
What Does Refinancing My Home Mean, and Why Should I Consider It?
Refinancing your home means replacing your current mortgage loan with a new one. This can mean that the terms change — like a 30-year mortgage now becoming a 15-year mortgage or an adjustable rate becoming a fixed rate — but most commonly the change is a lower interest rate. Just a 1% reduction in your mortgage interest rate can save you hundreds of dollars every month depending on your loan. That means that refinancing your home not only reduces your monthly payment, but it can also cut down on the amount of interest paid over the life of your loan and even help you to pay off your home sooner.
Refinancing does come with closing costs, which can range anywhere from 2 percent to 5 percent of the amount you refinance. Depending on how long you plan to remain in your home, it’s a good idea to calculate the break-even point to decide whether you’ll stay in your home long enough to recoup the closing costs and benefit from the savings of the refinance.
Interest Rates Might Be Climbing — But It’s Still a Great Time to Refinance
While it’s true that interest rates are on the rise, buyers and homeowners looking to refinance their homes are still enjoying lower rates than we’ve seen in the past.
This means that homeowners interested in refinancing can still reap in the benefits of lower interest rates on their mortgages and potentially save thousands of dollars over the life of their loan.
One of the best tools that you can have to help you in your Lafayette home refinance journey is a partnership with an experienced, savvy mortgage broker. With more than 20 years of experience as a Bay Area mortgage broker under her belt and with resources that expand across California, Karen Douglas has dedicated her time and energy into securing the best loans available for her clients, whether that’s securing a first-time mortgage loan or refinancing an existing one. Find out if home refinancing is right for you, and take the first step to saving thousands of dollars and paying off your home sooner when you call now.