Local Records Office – Olympia, WA: Refinancing your home almost always is an excellent option if you’d like to lower your interest rate or consolidate bills, says Local Records Office. That doesn’t mean you cannot go wrong with refinancing, as committing to the wrong loan can basically be devastating. To avoid issues later, here are five important questions you need to ask your mortgage broker while refinancing.
Local Records Office: Fixed-Rate Loan or Variable? Which One Suits Me Best?
Fixed-rate loans are those who offer a low initial rate, which may increase during the life of the mortgage. Fixed-rate loans alternatively offer the same rate through the entire life of the loan. When committing to an adjustable mortgage, it’s important to know what increases you will have and when. You don’t want to be taken off guard by an interest rate that increases way too fast; leaving you unable to pay your mortgage and bills says Local Records Office.
Local Records Office: What Are the Closing Costs in Olympia, WA?
Local Records Office says Olympia Washington has many real estate laws and offers tons of rights to homeowners. Closing costs may be several thousand dollars on many homes, which is why you will need to know what they are in advance. You should also find out whether you may be expected to pay these prices at closing, or if they shall be rolled into the amount you happen to be refinancing. Rolling them into this mortgage may increase your transaction, and will significantly increase the number of interest you will pay within the life of the loan. However, rolling in closing costs may very well be needed if you are unable to come up with the cash up front. Make sure to save a little extra money for situations like these.
Local Records Office: For How Long is the Loan?
Don’t assume your loan is going to be for a standard 25-year loan. Lenders these days are writing loans for as long as 45 years in order to generate monthly payments that are more affordable. The problem with this is that this longer your term, the more you will pay in interest says, Local Records Office. Make sure you insist in a 25-year loan or if possible, the 15 or 20-year mortgage, which may also have a lower interest rate.
Local Records Office: Is Private Mortgage Insurance REALLY Necessary?
So what is Private Mortgage Insurance or PMI? PMI is a sort of insurance that is added for a loan whenever your loan-to-value ratio is fewer than 75%. Just because you aren’t paying PMI now doesn’t mean you will not have to when you refinance. In case your home has decreased in price, or you are receiving purchasing, you could be borrowing more than 80% of your home’s price without realizing it.
Local Records Office: Is There a Prepayment Penalty?
Most mortgages automatically include no prepayment penalty, but that doesn’t mean you shouldn’t ask to be certain. Unless you have really bad credit, there is really no reason to accept a mortgage containing a prepayment punishment.
While it is critical to know the answers to these types of 5 questions, there are actually several other things to consider about your mortgage. Take time for you to review the terms carefully, and make sure to ask questions if there is something you cannot understand, says Local Records Office.