Mortgage interest is a constant that every homeowner pays. Obviously, the lower the interest rate, the less money you’ll pay every month on a 30-year mortgage. But if you really want to save money in the long run, a 15-year mortgage will save you thousands over the life of your loan, even if you have to pay more today. You can pay less for your mortgage with a refinance.
When rates are this low, finding a way to take advantage is a key. If you have a lot of equity in the home but still have 20 years left on your mortgage, you can refinance to the lower rate, save money on interest, and may not have to raise your monthly rate substantially.
Let’s do some math. If you have a 30-year fixed-rate mortgage for $450,000 at 4.375% that you took out back in 2010, you can refi to a 15-year fixed-rate loan right now at a rate around 3%.
If you refinance down to the 3%, but in a 15-year mortgage, your monthly payment would rise slightly. The good news is, paying an extra $500 a month saves you over $165,000 over those 15 years.
The more aggressive you are paying back your loan, the more principal you pay each month. Paying the principal down = paying less interest. When you get a low rate and have a 15-Year mortgage, you save money on the life of the loan.
A shorter loan at a lower rate will save you money.
Call The Home Loan Expert Team in St. Louis at (314) 781-9700, Chicago at (773) 770-4727, Indianapolis at (317) 550-1515, Nashville at (615) 810-8555 or Birmingham, AL at (205)721-7656. You can always apply online at hero.loan for your VA Loan, and www.thehomeloanexpert.com for your other mortgage needs, and we’re also open on Saturdays and will come to you to help close your loan. We work hard to make it easy on you. Nobody gets lower rates on better loans than The Home Loan Expert, Ryan Kelley, why go anywhere else?