Due to fluctuations in interest rates, many homeowners have refinanced their homes. While interest rates are not as low as they were a few years ago, if you purchased your home at an interest rate of 8.9% or higher, you may be able to save hundreds of dollars in monthly mortgage payments by locking in at a lower rate. The Law Office of Dom Chieffalo serves families and individuals interested in refinancing their existing mortgages. At your initial consultation, he will listen to your goals and concerns about the refinancing process and give you an honest assessment of your financial information and prospects for achieving those goals.
Currently, there are many options available to homeowners interested in refinancing. Adjustable Rate Mortgages, Interest Only Mortgages, and Fixed Rate Mortgages are available over terms of various lengths. After your options have been fully explained and discussed, you will be able to make the best decision as to which type is right for you. For more information regarding refinancing your home, contact real estate refinancing lawyer Dom Chieffalo today.
Recent news reports indicate foreclosures on homes have increased. In many cases, people have refinanced their home according to an adjustable rate. As a result, when the interest rate goes down, mortgage payments go down as well. However, when interest rates increase, mortgage payments increase. The advantage of an adjustable rate is decreased mortgage payments when interest rates are low - especially when they are lower than when you originally bought your home. When interest rates increase, homeowners have to be prepared to meet their accompanying financial obligations. As your attorney, Mr. Chieffalo discusses the pros and cons of adjustable rates so you can make an informed decision.
Interest only mortgages allow homeowners to pay only the interest owed on a home loan. Unless a homeowner pays more than the interest due, the principal of a loan isn't reduced. Typically, interest-only mortgages last for between 5 and 10 years. Since the principle balance remains unchanged, an interest only mortgage makes sense for those who have a good reason for making initial lower payments. For instance, if a wage earner is deployed on military duty or decides to quit work and go back to school, an interest only mortgage can help ease the financial stress of a family for a few years. However, if you are simply interested in "buying more house" with your loan, you may be exposing yourself to financial risk should job loss, illness, or other factors enter the picture after your period of interest only payments expires.
Fixed rate mortgages ensure that the rate you receive when you take out your home loan will remain unchanged until it is paid in full. While the interest rate attached to fixed rate mortgages is almost always higher than adjustable rates or interest-only mortgages, it is a more secure rate. Since your mortgage rate isn't subject to changes in the interest rate, when times are bad and interest rates increase, your mortgage payment won't. Additionally, with every payment you make you decrease the principal too, creating more equity than if you had an interest only mortgage.