Home Refinancing

St Louis Home Mortgage can help you find the best refinancing options for your situation.  Here is some information to get started. If you’d like to discuss your options in more detail, please give us a call or fill out the form on the right.  We would be happy to show you the best refinancing options.

Why should I want to lower my interest rate?

• Reducing your mortgage interest rate can save you tens of thousands of dollars over the life of your loan
• The more significant the gap between your loan’s interest rate and current rates, the bigger the savings for you
• If your creditworthiness has changed for the better, you may get a better rate or qualify for better loan terms
• Drop that PMI from your loan payment. An increase in your property value allows you to refinance the PMI or MIP right out of your loan

If I refinance, how much money could I save?

FOUR WAYS TO SAVE:

1. A Lower Monthly Payment can free up monthly cash.
2. Lower Overall Interest Charges can reduce the total cost you pay for your home.
3. You can Pay Off Your Loan Sooner. For example, you might have a similar payment, but more goes towards the principal and less towards interest, thus making the loan faster.
4. You can remove the PMI or MIP from your current loan.

Real savings typically occur when you have a reduction of at least 1% in your interest rate. Your savings will vary depending upon your loan balance, length of your loan, and your creditworthiness

Here is a refinancing example for reducing the interest rate by >2%:

Loan Balance $200,000 Payment (P&I) = $1,199 Loan Rate = 6%, 25 years left

New Refinance Interest Rate = 4% New Payment (P&I) = $1,055, 25 years left

1. Refinancing lowers the monthly payment by $144/month.
2. You would save a total of $43,200 in interest over the 25-year life remaining on the loan.

or

3. Refinance and Pay (P&I) $1,212 per month ($13 more per month) but shorten the loan by five years and eliminate paying a monthly mortgage payment.

In addition, when refinancing a loan, closing costs can occur and are required to be paid at closing – so let us help you determine if the rates are low enough to benefit you.

Depending upon your specific goals and situation, the numbers will vary.  You will have many options to consider, and working with a St Louis Home Mortgage professional can ensure you get the right loan for your situation.

Why should I Shorten the Length of my Loan?

• Lower Interest rates mean fewer interest charges on your loan
• You can keep your payment close to the same or maybe at a slight increase
• More of your payment goes towards the principal loan balance
• You can significantly reduce the time to pay off your loan
• You can substantially reduce the total amount you pay to own your home
• You can pay off your loan faster to eliminate your mortgage payment altogether

Why Should I Change From a Variable Rate to a Fixed Rate?

• Plan on staying in your current home for the foreseeable future
• A low-interest-rate environment offers a better overall deal
• Fixed-rate loans provide the certainty of an interest rate for the life of the loan
• Fix your monthly payments for principal and interest
• Knowing what your payment is a month after month and year after year provides a much greater degree of predictability in your monthly budget

I Want to Convert Some of My Home Equity into Cash

When is the best time to consider Converting Home Equity into Cash?

• It is wise when you have built up equity in your home.
• It’s worth looking into when current interest rates are at least 1% lower than your existing loan.
• You may consider turning some equity into cash if it would allow you to lower your payments at the same time.

Many homeowners utilize refinancing to improve their loans and raise cash…

…to pay off other debt,

…to make home improvements,

…to pay for college,

…to pay for a wedding,

…and when different financial needs for cash arise.

We can help you determine whether refinancing is viable for you.

Typical Loan Features for Converting Home Equity to Cash Refinancing 

• Cash-out is available up to 80% loan-to-value on Conventional Loans
• Cash-out is available up to 80% loan-to-value on FHA Loans
• Cash-out is available up to 100% loan-to-value on certain Veteran Affairs loans
• Recently listed properties may also qualify

I want to Refinance my FHA Mortgage

The Federal Housing Administration (FHA) offers options to lower loan rates, including a “Streamline” refinance. A refinance will allow you to reduce your rate and minimize closing costs on a new FHA loan. No changes can be made to the ownership of the property.

STREAMLINE LOAN FEATURES

• No appraisal is required for many FHA Loans
• There is limited underwriting and credit reviews

FHA REFINANCE LOAN FEATURES

• Loan-to-value of up to 96.5%
• I want to refinance my VA Loan
• Veteran Affairs (VA) loans provide financing for qualified veterans, reservists, or active-duty personnel.
• Homeowners typically must pay a one-time VA funding fee that can be financed into the loan amount.
• The existing VA Loan may qualify for an Interest Rate Reduction Loan (IRRL) and allow you to lower your rate and minimize closing costs on a new VA Loan.
• No changes can be made to the ownership of the property.

LOAN FEATURES OF AN IRRL

• No appraisal is required for many VA Loans
• Limited underwriting and credit review

LOAN FEATURES OF VA REFINANCE

• Loan-to-value of up to 100%
• Allows closing costs to come from a gift