The New Year is here! And with it, comes a chance for everyone to make a fresh start. An important change that many people make in this season is one which will improve their financial situation. Everyone should set at least one financial goal in 2017 to keep them on track with specific and tangible objectives.
New Year’s Financial Resolution
In Fidelity’s 2017 New Year Financial Resolutions Study, they found that out of the people who were “successful at keeping their financial resolution, 66% also said they were in a better financial situation than last year, compared to 38% of those who didn’t come as close to achieving their resolution.” Setting financial goals can make a difference for anyone committed to their future financial success.
Financial goals may include:
- Paying off debt
- Saving for retirement
- Building an emergency fund
In a time where interest rates are low, and housing prices are high, refinancing can help pay off debt, or kick-start retirement saving or an emergency fund.
Term and Rate Refinance
A term and rate refinance will allow the borrower to refinance only the term and the rate of their mortgage. This refinance replaces the loan terms with a new interest rate and payment term. This could significantly lower monthly payments, allowing borrowers to save money over the long term.
With cash-out refinancing, the mortgage is refinanced for more than is currently owed, and the borrower pockets the difference. They then make mortgage payments on the new loan amount. With this option, the borrower can pay off large amounts of credit card/car/student loan debt, or they could place a lump sum in retirement or an emergency fund for savings.
If used wisely, a home loan refinance could use home equity to lead borrowers to a more stable financial future. If you know of clients who are considering a home loan refinance, give The Polder Group at Summit Funding a call! We would love to reach out to them.