How To Get The Best Refinance Mortgage Rate

In order to get the best refinance mortgage rate possible, we first need to understand how it all works and what our options are. Right now, we can get fixed mortgages under 5% which is really good. Rates are at an historic low. However, there is no telling how long it will last. But, suffice it to say, that right now is the prime time to do it.

The options we have available to us are either fixed or adjustable rate mortgages. Then we can choose a term of either 15 years or 30 years. Which combination you choose will be based on what your future plans are.

Say you are planning on selling the house within 5 years, then refinancing it with a low ARM might give you the best refinance mortgage rate. However, with the real estate market the way it is, it may be harder for you to sell and recoup all your money unless your property appreciates substantially.

If you are planning on staying at the house long term, then getting a fixed percentage will give you the best refinance mortgage rate, especially considering the possibility that the Federal Reserve will raise the rates anytime now. If it does go up, your payments will remain the same, but for those who opted for the adjustable one and who weren’t able to sell, their payment per month can rise dramatically. You will be happy going this route when that happens.

Between the 15 year and 30 year terms is dependent on how secure you feel your income streams are. Because if you lose your job, your monthly financial requirements will not decrease and if you have an ARM, they might actually increase on you. If you are unsure, get the longer term with a no penalty for paying early. This way, you and your loan officer can calculate what you need to pay per month to pay it off early if you want to. And if something happens to your available income, then you can always revert back to your lower required monthly dues.

Now that we have discussed the differences of each, picking the right one will depend on our circumstances. If you are convinced that you will be selling in the next 5 to 6 years, then an ARM is better. But if you are looking to stay for the long term, then a 30 year fixed is the best.

Either way, now is the best time to act and lock in your best refinance mortgage rate!

This loan officer [] is both a financial and real estate expert and he will help you get the best loan for your situation.

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