Refinancing your home loan could give you financial flexibility, by allowing you to consolidate debt and reduce your overall monthly payments—freeing up cash for other important purposes. For example, when you refinance, you replace your current loan with a new one. Your goal may be to take cash out from the available equity you have in your home, or to adjust the terms of your loan such as to shorten the repayment term. Perhaps your goal is to lower your monthly mortgage payment, or to lower your overall monthly bill payments by consolidating your debts into a single loan which may also reduce the overall interest expense you pay each month. The reasons to refinance your loan are numerous.
Benefits of a refinance loan:
Refinance to Tap Your Equity
Getting a cash-out refinance home loan allows you to access cash from your home's available equity. Equity is the difference between the current value of your home and the amount you owe on your mortgage—and utilizing this equity is a big reason people refinance. You can use these extra funds to pay off high interest debt, or to pay for home improvements, college tuition or unexpected expenses. Financial advisors often point to cash-out refinance loans as a smart option to consider when borrowing for important purposes like these.
Refinance to Consolidate Debt
Consolidating debt by refinancing allows you to pay off higher interest rate debt, including credit cards, replacing those many bills with one sensibly-priced home loan and one convenient monthly payment --ideally at a lower interest rate, and with the added benefit of interest charges paid generally being tax deductible (please consult your tax advisor on the tax advantages available to you).
Refinance to Lower Your Monthly Payment
One of the biggest benefits of refinancing your loan is that you can potentially reduce your interest rate. This could significantly reduce your monthly mortgage payment. Even if your mortgage interest rate and payment aren't reduced, it can make sense to refinance to consolidate higher interest rate debts (like credit cards or a home equity line of credit) and reduce the amount of your total monthly payments, and use the surplus funds to pay down the principal balance of your debts faster.
Refinance to Adjust the Terms & Length of Your Loan
By refinancing, your existing loan is replaced with a new one. This gives you the ability to adjust the terms and length of your mortgage.
Shorten the length of your loan to build equity even faster! Or, lengthen the term to enjoy a lower mortgage payment and maximize tax deductible interest.
Refinance your high rate adjustable rate mortgage (ARM) to lock in a lower fixed rate. Or, refinance your fixed rate mortgage to an ARM to enjoy a possibly lower mortgage payment and interest rate during the initial years of the loan.
Refinancing your home is a lot easier than you would think!
Countrywide’s helpful Loan Consultants can help you find the right refinance loan option. Even if you have been turned down by other lenders, at Countrywide Bank's Full Spectrum Lending Division, we see the bigger picture. We understand that your current financial situation can be more important than your past. If you think your credit is less than perfect, you might qualify for a prime loan.
Countrywide’s Full Spectrum Lending is specifically geared towards helping you get the home loan you deserve. By calling 1-800-909-8217, you’ll be able to get expert advice on refinancing your home. What's more, we won't recommend refinancing unless we know we can help you meet your needs and realize your dreams.
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