If you’ve considered a refinance for your Utah home loan, it may be time to move forward with your plan.
Depending on your current home loan and your property value, you could significantly reduce your monthly mortgage payment by refinancing. The potentially volatile U.S. economic climate indicates that a rise in interest rates may be forthcoming. In addition, relaxed lending guidelines may open up other loan programs that are well-suited to your needs.
At What Interest Rate Should You Refinance Your Home?
Historically, Utah mortgage lenders recommended that homeowners wait to refinance until interest rates fell to at least 2 percentage points below your current rate.
But today, if you can find the right loan with the right combination of rate, term, upfront costs, etc., the specific interest rate could even be the same (or close to the same) as your existing loan and it would still make sense to refinance.
However, if rates go up, you may have to look more closely into what would or would not be right for you.
Will Refinance Mortgage Rates Increase in 2018?
Even the most savvy finance industry experts don’t know the answer to this question. What we do know, however, is that the U.S. economic indices could do anything over the next year.
Some of the most volatile and influential factors include who will be the new, incoming chair of the Federal Reserve and how the proposed tax reform bill comes through Congress. In addition, inflation is on the rise and the stock market is on fire. Traditionally, mortgage interest rates rise with significant growth in this key indicator.
Industry experts predicted that mortgage rates would hit 4.5 percent or more by the fourth quarter of 2017. Instead, rates remain around 4 percent. So while we still have historically low mortgage interest numbers, all signs point to an increase at any time.
How Can You Determine the Right Time to Refinance?
The best way to answer this question is to talk to an experienced home loan professional to see if you may now qualify for a significantly better loan program than you got originally.
In many cases, you can refinance your home loan for little to no money upfront. If private mortgage insurance (PMI) is included in your loan but you now have 20 percent or more equity in your home, a refinance may allow you to drop this expensive provision.
You may also have the option of switching to a different type of loan or loan term, either of which could significantly lower your monthly payment and the amount of interest you ultimately pay for financing your home.
To explore the possibility of refinancing your Utah home, contact Intercap Lending today. Based in Orem, Utah, Intercap Lending assists clients throughout northern Utah with real estate financing. Check out our home loan refinance calculator, and then call us to explore the possibility of refinancing your Utah mortgage loan.