With inflation at all-time highs these days, many people are feeling the pinch in their budgets, and are looking for ways to cut costs, tighten the belt, and find a little extra cash. Refinancing your mortgage could still be a way to mitigate those daily effects on your budget. True, rates aren’t at the historic lows we saw last year, but you could still save some money.
A few things to consider:
First, what is your current mortgage rate? If you can’t reduce it by at least half a percentage or more, it might not be advantageous for you go through the refinance process.
Next, are you still paying private mortgage insurance (PMI)? If you are, a refi might be able to eliminate the PMI from your mortgage bill and easy save you money right there.
Another thing to consider is extending the term of your mortgage. If you’ve paid a 30-year loan down to 15 or 20 years, you could refinance your loan back to 30 years, which could drastically reduce your payment.
Lastly, now may be a good time to look at any equity you’ve built up. If you are carrying any higher interest debt, perhaps on a credit card or a large car payment, those loans could be rolled into the mortgage with a lower rate, putting more cash in your pocket each month.
If you’re feeling the pinch and looking for ways to adjust your budget and weather this inflation period, feel free to give me a call with any questions you have. Our team is happy to sit down and help you make adjustments.
Article by Kyrk Davis, Senior Partner at Family Financial Partners — a financial services firm in Lexington, Kentucky.
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