Chicago Refinance Loans

When to Refinance Your Chicago Home Mortgage

The timing might be right to refinance your Chicago mortgage loan. Low rates may help you lower your monthly payment significantly. Perhaps by refinancing to a shorter loan term you can even pay off your mortgage sooner! Or you might want to “cash out” some of the built-up equity in your home, which you can use to consolidate debt, improve your home, take a vacation – whatever! Maybe you have a fixed-rate mortgage home loan now with a higher rate, or maybe you have an ARM (adjustable rate mortgage) where the interest rate varies. Even if it’s low now, unlike your ARM, when you qualify for a fixed-rate mortgage you lock that low rate in for the life of your loan. This is especially a good idea if you don’t think you’ll be moving within the next five years or so. On the other hand, if you do see yourself moving within the next few years, an ARM with a low initial rate might be the best way to lower your monthly payment.

The old and arbitrary rule of thumb to make your chicago refinance make sense if you can lower your interest rate by at least two percentage points for example, from 7% to 5%. With larger loan amounts today, this is not always accurate. Reducing your interest rate with a chicago refinance loan by 1% on a 300,000.00 loan is an annual savings of 3,000.00. What really matters, is how long it will take you recoup the cost, and whether you plan to stay in your home that long. In other words, make sure you understand — and are comfortable with — the amount of time it will take for your overall savings to compensate for the cost of the chicago refinance.We’ll work with you to determine if a chicago refinance loan is right for you. How likley you are to sell your home in the near future, and what effect refinancing might have on your future plans.