Refinance and save money when you need it the most

Let us do the math for you.

Cash out

Use the cash to pay off your
debts, make home improvements, or other expenses.

Lower your payment

Refinance and stop paying mortgage insurance or choose to pay a lower interest rate.

Shorten the term

Refinance and stop paying mortgage insurance or choose to pay a lower interest rate.
Save half a point or more on your interest rate and enjoy zero lender fees

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Mortgage Refinancing Options

Although the main reason for refinancing a mortgage loan is to save money in some way, there are various approaches to take. Some result in an influx of cash that you can spend on whatever you need while others improve your monthly payment amounts to make the mortgage more affordable.

Cash-Out Refinance

If you want to refinance your mortgage to get an influx of cash based on home equity, then a cash-out refinance could work for you. Essentially, you replace your current home loan with a new loan that is larger than what it currently owed on the principal. The initial loan closes, and the difference between the old loan and the new loan is received as cash. A cash-out refinance is common for those planning to renovate their homes and need some funds to do so. This should only be done if you have the means to cover the higher loan payments that will likely result from a cash-out refinancing, though obtaining a better interest rate can mitigate this increase.

Cash-In Refinance

This type of mortgage refinance allows you to pay a lump sum of cash into the principal balance and acquire a loan with better terms while increasing equity in your home. This would be an option for homeowners who have some funds to work with and want to negotiate a better loan agreement. It could reduce your monthly mortgage payment or shorten the life of the loan if you wish.

Rate and Term Refinance

You may want to refinance your mortgage simply to take advantage of better refinance rates. Maybe the market is favorable and interest rates have lowered since you locked in a 30-year fixed-rate mortgage. The refinance process can result in a new loan that has a lower interest rate, reducing your monthly payment. You could also refinance to shorten the loan term. Perhaps you are hoping to pay off the home sooner because your income has grown. This loan program renegotiation will allow you to choose a shorter loan term, though your estimated monthly payment will increase unless you pay a lump sum into the principal balance.

Reverse Mortgage Refinance

This type of mortgage is technically a refinancing option, but it is only available to homeowners who are 62 and above and have built a lot of home equity. Essentially, you would no longer have to make monthly payments on the loan while you are living. Instead, you would receive cash based on the equity in your home. The remaining debt will be paid to the lender upon your death either through the sale of the home or payments from your heirs after a normal mortgage refinance.

Short Refinance to Lower Monthly Payment

If you are at risk of foreclosure, then you may want to consider a short refinance loan. This replaces your current loan balance with one that has a much lower balance, allowing you to have a lower mortgage payment each month. However, this refinancing process can hurt your credit score, so do so only when necessary to keep your home.

How to Know if Refinancing Your Mortgage is the Right Decision

There are a few circumstances when it makes sense to refinance your mortgage, many of which are listed above. First, if you want to lower your monthly payment or reduce the life of the loan, then a term and rate refinance loan would make sense, resulting in monthly savings. Second, if you want to put down a significant lump sum of cash toward the principal for more home equity and change the terms of your loan, then you can refinance and get a lower loan amount.

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Hero Mortgage Can Help You Refinance

Whether you want to lower your monthly payment, eliminate mortgage insurance, take advantage of a better credit score for lower interest rates, switch to an adjustable-rate mortgage (ARM), acquire a new fixed-rate loan, reduce your loan term, or take advantage of your home’s equity, District Lending can help with refinancing your mortgage. Talk to your financial advisor or contact our team to discuss refinance rates and what mortgage loans would be right for your refinancing goals. See how cash-out refinancing, new mortgage terms, a lower interest payment, or a switch to fixed-rate or adjustable-rate mortgages can save you money through refinancing your mortgage.

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