top of page
Search

Reasons to Refinance When Rates are Rising

rpccarrigan

Your mortgage bill is likely the largest payment in your monthly budget. Clients refinance their mortgage when interest rates drop in order to get the lowest monthly payment possible, and this makes sense if their home mortgage is their only debt. But what about when interest rates have risen slightly? Is there a reason to refinance then?


Consolidating Debt

If a home mortgage is the only debt you have, then only refinancing when interest rates are lower makes sense. But if you have other debt that carries a higher interest rate, like credit cards, student loans, or car payments, then it may make sense to do a cash out refinance. This allows you to receive cash when you refinance that you can use to immediately pay off other debt. While your mortgage payment may become higher, your total monthly cash outlay would be lower because you no longer have the other monthly payments.

Client Case

I recently helped a client refinance his mortgage from around 3% to 3.75%. Why would someone refinance into a higher interest rate? Unfortunately, my client had accumulated a decent amount of credit card debt that had an interest rate of 19%. I ran the numbers for him and not only would his total monthly payments be lower refinancing, but his total cash outflow over the life of his mortgage would be lower.

Here to Help You

My team and I are never going to suggest refinancing if it doesn't make financial sense for you. But unlike other lenders, we will take a holistic approach to your financial situation and try to guide you in a direction that puts you in the best position to achieve your financial goals. Feel free to reach out if you have any questions related to mortgages, budgeting or debt. I am here to help.

6 views0 comments

Recent Posts

See All

Comments


white shamrock logo.png

Shamrock Home Mortgage is a full service mortgage brokerage company registered with the NMLS under #1680873.  Shamrock Home Mortgage has its home office in Aurora, IL as well as a satellite office in San Antonio, TX and is licensed to provide mortgage brokerage services. Illinois Residential Licensee 031.0008400, Texas 238717, NMLS # 238717

SERVICES

+ Home Purchase

+ Refinance

+ FHA Loan

+ VA Loan

+ Fixed Rate Loan

+ Adjustable Rate Loan

CONTACT

© 2021 Shamrock Home Mortgage. Created by M&M Digital Marketing

Consumers wishing to file a complaint against a company or a residential mortgage loan originator should complete and send a complaint form to the Texas department of savings and mortgage lending, 2601 North Lamar, Suite 201, Austin, Texas 78705. Complaint forms and instructions may be obtained from the department’s website at www.sml.texas.gov. a toll-free consumer hotline is available at 1-877-276-5550. The department maintains a recovery fund to make payments of certain actual out of pocket damages sustained by borrowers caused by acts of licensed residential mortgage loan originators. A written application for reimbursement from the recovery fund must be filed with and investigated by the department prior to the payment of a claim. For more information about the recovery fund, please consult the department’s website at www.sml.texas.gov.
The Department of Financial and Professional Regulation (Department) evaluates our performance in meeting the financial services needs of this community, including the needs of low-income to moderate-income households. The Department takes this evaluation into account when deciding on certain applications submitted by us for approval by the Department. Your involvement is encouraged. You may obtain a copy of our evaluation. You may also submit signed, written comments about our performance in meeting community financial services needs to the Department.
bottom of page