Many borrowers with adjustable-rate loans are finding their payments rising now. As a result, owners are discovering fixed-rate mortgages are an attractive alternative. The NY Times recently reported that there are 1.2 trillion dollars of adjustable mortgages that are scheduled to adjust in 2007. With fixed mortgage rates at almost 12 month lows, now is the time to consider refinancing.
With the appreciation homeowners have seen in recent years, it will also be worth exploring the option of including credit card debt and other debt all into one loan. Consolidating saves wasted time spent paying these bills.
Paying off the high interest rates that are charged by credit card companies usually saves clients hundreds if not thousands of dollars per month. Paying off a Home Equity Line of Credit that is based on the constantly changing Prime Rate, which is currently at 8.25%, will also create additional savings and reduce monthly payments.
An additional benefit to consolidating with a mortgage is that interest payments are deductible on your tax return every year! Most of the interest on other debt you are paying is not tax deductible; consolidating into one mortgage is the most economical way to carry debt.
Home loans with fixed rates also make inflation work for homeowners. As prices for homes go up, the value in the home increases and generally so does your household income. As a result, homeowners who have chosen a fixed rate will pay a lower percentage of their monthly income because their mortgage payment remains the same.
Marc C. Demetriou, CLU, ChFC is a Mortgage Consultant at Residential Home Funding Corp. with over 15 years of Finance related experience. For GSA members, he will review your current situation and help determine what mortgage program is best suited for you. His offices are located in Bloomingdale and Hoboken, NJ and can provide a mortgage in most states throughout the country. You can contact him at 973-492-0117 or email him at mdemetriou@rhfunding.com
