Refinancing your home loan* can help lower your monthly payment, reduce your loan rate or even decrease your total payment amount. We’ll help you understand the pros and cons of refinancing, so you can evaluate whether it’s the right time to consider a refinance.
THE RIGHT TIME TO REFINANCE YOUR HOME LOAN
If your home’s market value has increased, you may want to look into refinancing. When thinking about refinancing at a lower rate, there are two ways in which you can benefit:
- You can keep your current term and lower your monthly payments.
- You can keep your monthly payments the same but shorten the repayment term.
Refinancing during the earlier years of your mortgage may be a good choice because that’s when most of your payments are going toward the interest. In the later years of your home loan, as you pay more on principal than interest, keeping your original loan might make the most sense.
WHY SHOULD YOU REFINANCE YOUR HOME?
TO INCREASE YOUR CASH FLOW
Refinancing your home can free up some money in your budget by reducing your monthly payments.
TO REDUCE THE TOTAL AMOUNT YOU PAY
If you want to pay off your home sooner and lower the total amount of interest that you’re paying for it, refinancing for a shorter loan term can be the right choice for you. Keep an eye on interest rates — if they have dropped or you can take advantage of an offer, you may be able to keep your monthly payment about the same as it is now and pay off your home a few years earlier. Doing this could potentially save you thousands of dollars in interest over the life of the loan.
TO TAKE CASH OUT
Taking cash out means receiving a one-time cash payment during refinancing. If your home has increased in value, refinancing can help you take advantage of that increase in equity. If you refinance, you can use the additional equity to help pay off other high-interest debts or pay for big purchases like a wedding, college education or home renovations.
Ready to refinance your home loan? Call a GECU home loan professional at 778.9221, toll-free at 1.800.772.4328, or start your application online at gecu.com.
*All loans subject to credit qualification and approval. The property must be located in the United States, within a 150-mile radius of El Paso County, to include Hudspeth County. Certain fees and conditions apply. Learn how to become a member at gecu.com. Equal Housing Opportunity Lender.