Reasons to Refinance 

The first order of steps when it comes to deciding if you should refinance, is to decide and make goals. The reason some people refinance is to take cash out, possibly get a lower payment or even shorten your mortgage term. 

Take Money Out

Refinancing your mortgage is a good way to exercise the equity you have with your house.  With a cashing out option to refinance, you refinance for a slightly higher loan sum than what you would possibly owe and then pocket the difference. Also, anything that comes to you that you receive is tax-free. 

You are also able to take cash out to finance home renovations, education, or anything else you need. 

Get a Lower Payment

Getting a lower mortgage payment will help make more room in your budget for other things. Here are just a few ways you can lower your payment if you choose to refinance.

• You may be able to refinance your home or loan at a lower rate. Getting a lower rate means lowering the interest amount of your monthly payment. Also this helps with savings. 

• You could possibly be able to refinance to get rid of your mortgage insurance. Mortgage insurance is usually required when you lay down less than 20%. You have the ability to save a good amount of money a month simply by refinancing to stop paying for mortgage insurance. 

• You may be able to lower your payments by changing your mortgage term. Extending your term stretches out your payments over more years, which enables each payment to be cheaper and more affordable.

Also, there is a possibility that there will be other ways you can get a lower payment, so it pays to check with your lender to see how they can help you get a payment that fits your current budget. 

Decrease The Term Of Your Mortgage  

Decreasing the term of your mortgage is a good way to build on and save on interest. In many cases, shortening your term means you’ll likely receive a better interest rate. In many cases shortening your term means you'll receive a more appealing interest rate. With a better interest rate and fewer years of payments, that means big interest savings down the road. 

Although you may be shortening the time of your term, that could possibly mean an increase in your monthly mortgage payment. However, less of your payment will be put towards interest, and even a bigger amount of it will go toward paying down your balance. This gives you the ability to build equity and pay off your home in a faster time frame. 

Thing You Need to Check and Go Over Before Refinancing

• Your Current Credit Score

• How Much Is Your Monthly Mortgage Payment

• The Value and Worth of Your Home

• Your DTI (Debt-To-Income)

Understanding the value of your house can be a sure sign of how much equity you have. To figure this out, just subtract your current mortgage balance from the estimated value of your home. 

Another factor to take into consideration is your DTI (Debt-To-Income). DTI is the combination of your monthly debt payments and divided by your gross monthly income. 

Why Choose Tampa Bay Home Mortgage

Tampa Bay Home Mortgage is ready and willing to provide quality service to those in need. We treat each need in accordance with the person and their needs. Get started today and fill out an FHA loan application form online. Choose us now!