At Home in Berks Fall 2020 - 22

FEATURES

Why now is the right
time to refinance
your mortgage
By Lindsay Kennedy, Muhlenberg Branch Manager, Visions Federal Credit Union

T

he pandemic has cast a long shadow over 2020, with
many in particular thinking about their housing.
These thoughts include worrying about payments to
completing those improvements that have been on the "to
do list" for far too long.

Thankfully, now is the best time to refinance in years.
Here are just some of the reasons why.

You have projects to pay for

The pandemic has forced all of us to stay at home, and
that means many of us are thinking about improvements.
You may be one of them, too, judging by the numbers.
Hardware and home improvement sales are at record highs,
with millions of people crossing those long overdue projects
off their lists.

Annual Percentage Rates have been trending downward
for some time now, from the traditional 30-year fixed to
Adjustable Rate Mortgages. For many, a mortgage refinance
can be worth it for the rate change, alone.

If you are looking for a convenient way to pay for them,
consider using your equity. Put simply, your equity is the
difference in how much your home is worth versus how
much you owe on it. That means if you have a $250,000
home with a $150,000 mortgage balance, you have $100,000
in equity you may be able to use.

Consider this long-term example. A 15-year, $150,000
mortgage at five percent interest will accrue about $63,500
in interest over the life of the loan. Compare that to $49,700
in interest at four percent on the same home, and you are
looking at about $13,800 in savings.

Many lenders offer cash out mortgage refinancing,
allowing you to use the extra cash as you see fit. Ask
yourself this: if you can cross off some projects, improve the
comfort of your home, and lower your interest rate, to boot,
what are you waiting for?

In general, the rule of thumb is that a mortgage refinance
is worth it if your APR will change by one percent or more.
Take a moment to research your current rate versus those
your financial institution is offering. And, if you have had
your mortgage since 2008 or earlier, now may be the perfect
time to give yourself a reduction.

You want to reduce your payments

Rates are historically low

22

AT HOME IN BERKs Fall 2020

The math is simple: a lower interest rate means a lower
payment. Take the 15-year, $150,000 mortgage example
mentioned earlier. At five percent interest, your principal
and interest payment is close to $1,200 per month.
Lowering it even a percentage point to four percent will



At Home in Berks Fall 2020

Table of Contents for the Digital Edition of At Home in Berks Fall 2020

At Home in Berks Fall 2020 - 1
At Home in Berks Fall 2020 - 2
At Home in Berks Fall 2020 - 3
At Home in Berks Fall 2020 - 4
At Home in Berks Fall 2020 - 5
At Home in Berks Fall 2020 - 6
At Home in Berks Fall 2020 - 7
At Home in Berks Fall 2020 - 8
At Home in Berks Fall 2020 - 9
At Home in Berks Fall 2020 - 10
At Home in Berks Fall 2020 - 11
At Home in Berks Fall 2020 - 12
At Home in Berks Fall 2020 - 13
At Home in Berks Fall 2020 - 14
At Home in Berks Fall 2020 - 15
At Home in Berks Fall 2020 - 16
At Home in Berks Fall 2020 - 17
At Home in Berks Fall 2020 - 18
At Home in Berks Fall 2020 - 19
At Home in Berks Fall 2020 - 20
At Home in Berks Fall 2020 - 21
At Home in Berks Fall 2020 - 22
At Home in Berks Fall 2020 - 23
At Home in Berks Fall 2020 - 24
At Home in Berks Fall 2020 - 25
At Home in Berks Fall 2020 - 26
At Home in Berks Fall 2020 - 27
At Home in Berks Fall 2020 - 28
At Home in Berks Fall 2020 - 29
At Home in Berks Fall 2020 - 30
At Home in Berks Fall 2020 - 31
At Home in Berks Fall 2020 - 32
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksFall2021
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksApril2021
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeinBerksFall2020
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeinBerksSummer2020
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksWinter2020
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeinBerksWinter2019
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksJune2019
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksSpring2019
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksFebruary2019
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksDecember18
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksOctober2018
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksAugust2018
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksJune2018
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksJune18
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksApril2018
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksFebruary2018
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksDecember17
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksOctober2017
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksAugust
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerks_June2017
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerksApril
https://www.nxtbook.com/hoffmann/athomeinberks/AtHomeInBerks
https://www.nxtbookmedia.com