Refinance Your Mortgage in the State of Alabama
There are several reasons to refinance in Alabama: lower monthly payments, extra cash, and a shortened mortgage. When choosing to refinance, there are important factors to consider:
- Will the amount saved on interest payments outweigh the refinance costs
- Length of time you plan on staying in your home
- Taking out equity to pay off debt
- Cost of home improvements
There are different loan options when refinancing your home. In Alabama, there are different options, including: Fixed Rate Mortgage Loans, Adjustable Rate Mortgage Loans, and and Interest Only Loans. Fixed Rate Mortgages are mortgages that with a fixed interest rate that is guaranteed not to change over the life of your loan, no matter how the market changes. This type of loan is if you want fixed monthly bills, and plan on staying in their homes for an extended period of time.
Adjustable Rate Mortgage Loan
An Adjustable Rate works well if you aren't planning to stay in your homes for an extended period. The interest rate paid fluctuates with the current market.
Interest Only Loan
Interest Only Loans are alternatives to the Fixed Rate Mortgages. The interest of the loan is paid on the first portion of the payment term. Principal is paid after that. This type of loan is good if you are going to be a short-term borrower.
When considering a home refinance
, it is important to research all options. Alabama has laws regarding foreclosure (Foreclosure Mortgage Law) and licensed brokers (Licensing Mortgage Law). Research the types of loans available in order to be prepared when locating a broker. When working with a broker, consider his credentials (ask for references), the speed of responses, and how well they respond to any inquiries you may have.