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When Is the Right Time to Refinance My Property?

Sherman Oaks Homeowners Association vice president Matt Epstein checks in with his take on refinancing your living space.

Many people ask me, “Should I take advantage of the current super low interest rates and refinance my place?”

You would have had to been asleep for the past few years to not know that interest rates are at a place that we haven’t seen in 60 years.  

Some reasons to refinance:

  • Low interest rates
  • Property values have increased in the last year
  • Banks are more eager to do loans than they have been in years

So is this the right time for you?

You need to ask yourself a few important questions to determine if refinancing is right for you:

  • Do you have at least 20% equity in your property?
  • Do you have a good credit score?
  • Do you have income that will support the loan that you are going for?

If the answers to the above questions are 'yes', then the next question is, how long do you plan on staying in your property?

If you plan on only being in your property for a short time, let’s say less than five years, then you probably won’t be paying a whole lot of principle reduction down, especially if you have had your loan for less than 10 years. So in this case, you would want look into an ARM loan. These Adjustable Rate Mortgages are the lowest, but they will adjust up eventually.

If you plan on being in your house for a long time, then you may look at a couple of options. The lowest fixed rates are on 10 or 15 year fixed programs. If you haven’t refinanced your property in years and your rate is over five percent, then you may be able to get a new 15 year fixed rate and your payments might be about the same as you are paying now.

If you just want to lower your payments, then you also may want to just get a 30 year fixed program. 

There are a lot of great loan programs out there, and there are some loan programs that aren’t so good. Some have hidden fees and other things that may not be good for you. Be careful and always make sure that when you are refinancing that you know the company that you are working with or make sure you check them out. There are a lot of really good lenders and loan brokers, but there are also scammers or sales people that are not looking out for you. 

Any questions of comments please contact Matt Epstein @ Prudential California Realty @ somatt@aol.com or (818) 789-7408.  Matt Epstein is considered the expert for real estate sales in the South/East San Fernando Valley.

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