Homeowner Refinancing Guide

This guide provides a look at options for lowering interest rates , taking cash out to consolidate debt, pay for college or funds for investing. The highlighted loan programs help you decide the best options to fit your goals.

What are the different types of mortgage refinancing available?

Homeowners can leverage several primary refinance methods depending on distinct financial objectives:

Rate-and-Term Refinance: This adjusts your active interest rate, changes the loan duration (such as transitioning from a 30-year down to a 15-year term), or balances both without altering your existing loan balance.
Cash-Out Refinance: This unlocks accrued liquid wealth by replacing your current loan with a larger mortgage, allowing you to withdraw your home's equity in cash for large projects, home improvements, or debt consolidation purposes.
Cash-In Refinance: This allows you to pay a substantial lump sum toward your principal loan balance during closing to lower your overall loan-to-value ratio, secure a lower rate, and drastically reduce your monthly payment obligations.

How do I know if refinancing my mortgage is actually worth it?

Generally reducing your interest rate by 1% or 2% is beneficial with the rule of thumb that you recover the closing costs within 48 months of the refinance from the monthly savings. The calculation also includes when a refinance removes PMI or MI.

Mortgage Refinancing Strategies

Rate and Term Lowering the rate and possibly removing PMI and MI when refinancing from FHA to conventional.

PMI and MI Removal Strategies If the value is 80% or less PMI is not required and will not be included in the refinance. Closing with a first and second mortgage or HELOC with the first mortgage equal or less than 80% will also remove PMI.

Cash out Take cash out with a first mortgage refinance or first and second mortgage. the overall payment may be less than total current monthly debts.

Home Equity A revolving line of credit using a home as collateral. This option can be a first or second mortgage for primary, second and investment homes

Loan Recast The borrower makes a one time large principal payment and the remaining loan balance can be recast over the reming term lowering the monthly payment without refinancing.

Call to discuss the best option for you! (813)-498-1616

Get a Quick Quote

First Name *

Last Name *

Email *

Phone Number *

Loan Amount *

Property Value *

Loan Type *

Credit Score *

By providing your phone number and/or email and clicking "Submit" you agree to our Terms of Service and Privacy Policy and consent to receive marketing communications from David Barrett Mortgage| Barrett Financial Group, LLC via text, call, or email, including automated messages. To opt out, reply 'STOP' to any text. Message and data rates may apply.