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Deciding Whether To Move or Refinance: Which Is The Better Option?

Deciding Whether To Move or Refinance: Which Is The Better Option?There are a lot of people who are wondering if now is the right time to move or refinance their current home loan. With interest rates still favorable, a lot of homeowners have the potential to save a lot of money if they are able to secure a home loan with a lower interest rate. There are two ways homeowners can secure a home loan with a lower interest rate. The first is to refinance. The second is to move. Which option is better? There are a few key points to keep in mind.

Taking A Closer Look At Refinancing

There are a lot of homeowners who have an abundance of equity currently built up in their homes, making this a great time to refinance. With a refinance, there are multiple options available. Some homeowners might refinance to access the equity in their homes, allowing them to complete a project. Some homeowners might refinance in an effort to pay off their home loan sooner. If homeowners are trying to access more equity, or are trying to shorten the term of the loan, then refinancing might be the smart move.

Looking At The Option Of Moving

The other option is to get a new home loan entirely by moving. This is an attractive option for homeowners who might have a dream house they would like to move to. In particular, any homeowner who currently has a home loan with a high interest rate should consider moving into their dream home now. Because mortgage rates are low right now, this is a chance for homeowners to move into a larger house while keeping their mortgage payments the same or less by obtaining a lower interest rate.

Every Situation Is Different

In the end, every situation is different. Because interest rates right now are so low, now could be the time for homeowners to consider moving or refinancing. Switching to a home loan with a lower interest rate could save tens of thousands of dollars over the life of the loan. Anyone with questions or concerns should reach out to a professional for help.

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Do You Have Enough Of A Down Payment Saved Up?

Do You Have Enough Of A Down Payment Saved Up?If you are planning on purchasing a home in the near future, you need to make sure you have enough money saved up. While there are a lot of expenses that go along with purchasing a home, the biggest expense is the down payment.

The common belief is that people have to put 20 percent down; however, even if you don’t have 20 percent saved up, you might still be able to purchase a home. It will depend on whether you can get a lender to provide a loan that is greater than 80 percent of the purchase price of a home. If you have a strong credit history, you may be able to get one.

Getting A Loan With Less Than 20 Percent Down

First, many lenders realize that many people do not have enough money saved up to put down 20 percent. After all, this could be tens of thousands of dollars.  Although some people might be able to get a loan with only 10 percent down, those with outstanding credit might even qualify for a larger loan. There are certain people, such as veterans, who might have other options outside of conventional loans that might open other doors. If you are looking to get a home loan for less than 20 percent down, you will want to check all of your options.

How To Get A Loan For Less Than 20 Percent Down

Particularly if you are a first-time homebuyer, you might not know how to get a loan for less than 20 percent down. First, you need to have a strong credit score. If the lender is giving you a larger loan, they will want to make sure you can pay it back. Having a strong credit score can prove this to them. You may want to check your credit report ahead of time to correct any inaccuracies.

Second, you need to take a look at your debt to income ratio. If you have a lot of debt, consider paying this down before applying for a home loan.

Finally, trust an experienced lender to guide you through the process. You might be able to get a home loan for less than 20 percent down.

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