Not too long ago you might have heard advice stating that you should only refinance your Connecticut home mortgage loan if your new interest rate is at least two points lower. However, today I am advising you to do something that will save your interest rate from increasing two points!
While only refinancing if your interest rate will decrease by two points may have been true years ago, it will get you stuck with a ever-increasing mortgage payment today. Especially with subprime companies dropping off the face of the earth over the last few years, if you wait for much longer then you may not have any mortgage companies that will offer you a new loan!
The main issues that are leaving many Connecticut homeowners high and dry are: No equity remaining Home values have leveled off Adjustable rate mortgage is about to increase to an unaffordable payment
The solution that I recommend dozens of times a day is the FHA Mortgage. If you have managed to make all payments on time in the last 12 month’s and can show your income then you have a chance to get financing up to 97% of the value of your property at rates that are usually around 6.75%.
Refinancing into a FHA might mean you will be able to lower your interest rate and monthly payment – most times significantly. Or you might prevent your payment from rising significantly. You might also be able to "cash out" some of the built-up equity in your home, which you can use to consolidate debt, improve your home or simply go on a vacation. If you have managed your FICO scores responsibly then you can come away from closing with lower rates and balances, you might also be able to build up home equity faster with a shorter-term new mortgage.
While traditionally in a Connecticut home loan refinance I would focus on the monthly savings that you get immediately, these days I am receiving many calls for homeowners that are trying to prevent their payment from going up.
Keep in mind that when you refinance, you're paying for most of the same things you paid for when you closed on your original mortgage. These will include settlement costs and other fees, an appraisal, lender's title insurance, underwriting fees, and so on.
Always be sure to verify if you have to pay a penalty if you refinance your previous mortgage too quickly. Connecticut home loans allow lenders to impose this pre-payment penalty. However, it ultimately depends on the terms of your existing.
The beauty of FHA in Connecticut is that you will never have a pre-payment penalty!
Ultimately, for most people the amount of up-front costs to refinance are made up very quickly in monthly savings. We'll work with you to determine what program is best for you, considering your cash on hand, how likely you are to sell your home in the near future, and what effect refinancing might have on your taxes.
Chris Rivers, a Connecticut mortgage broker, specializes in offering low interest rates for Connecticut refinance mortgages after bankruptcy even if you have 30, 60 or 90 day late on your mortgage and late payments on other accounts. When you need to refinance your Connecticut adjustable rate home mortgage into a fixed rate mortgage with great credit scores then use a Connecticut FHA Mortgage
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