The recent dip in interest rates has many homeowners looking at their mortgage options, but lower rates aren't the only reason to refinance.

While it's tempting to hold on to recession-era rates, it may not be the best financial decision. While a lower interest rate does make a significant difference over the course of a 30-year mortgage, the average career-aged home owner will relocate within 3-5 years of purchase. For these individuals and families, the savings may not outweigh the benefits of a refinance.

Three GREAT Reasons to Refinance:

Remove mortgage insurance. Private mortgage insurance (PMI) is required when the original loan amount is more than 80% of the appraised value of the home (referred to as loan to value or LTV). Refinancing with a lower LTV could remove the PMI requirement and reduce monthly payments significantly.

• Apply the extra money to the loan principal every month.


• Save it and avoid using credit on your next vacation or large purchase.


• Use the money to pay down your auto or student loans.

Convert equity to cash. A cash-out refinance lets qualified owners borrow against the equity in their home without a second mortgage. A new loan for up to 80% of the current appraised home value pays off the original mortgage and the homeowner receives the remaining funds by check or direct deposit.

• Pay off high-interest credit cards.


• Get rid of medical debt, student loans or back taxes.


• Put in a pool, buy a car or take a vacation!

Change the loan term. Refinancing to change the terms of the loan has many potential benefits.

• Lower payments by refinancing a 15-year loan to a 30-year loan.


• Avoid a balloon payment by refinancing to a fixed-rate mortgage.


• Lower rates when risk factors like credit score or debt to income (DTI) have improved.

If you aren’t sure if a refinance is a smart choice for your circumstances, call the Boles Group at Bay Equity Home Loans in Gilbert. A licensed Boles Group loan officer will review your current financial situation, find your available options and help you come up with a plan that makes the most sense for your short-term and long-term goals.

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Bay Equity Home Loans Gilbert\
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Bay Equity Home Loans Gilbert, located just west of Power on Pecos, is a local branch of Bay Equity Home Loans LLC licensed to originate home loans for purchase or refinance in nine states (AZ, CA, CO, ID, MN, NM, NV, OR, WA). The veteran lending professionals at the Bay Equity Gilbert branch have the knowledge and experience needed to create solutions where other lenders create problems. The Bay Equity Gilbert branch prides itself on