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Ok, have you started to ask...What do I do now?
| Clark and Regina M. in Westport, CT
"My wife and I recently re-financed our mortgage. The market was turbulent and we had a lot of questions. Some brokers we contacted were impatient with us. Some gave us a high - pressure pitch. Then we found Acorn Home Mortgage.
From the very first contact I had with Acorn Home Mortgage, I was put at ease. They demystified the confusing scenarios that banks were offering and helped guide us to the mortgage that was right for us. Without stress, guilt or the bait and switch tactics that some brokers used. I would recommend Acorn to anyone who is looking for solid, trustworthy people to work with and a company that really cares about their customers. Not only did we get a great rate, we found a great mortgage broker that we will work with everytime from now on. When you find a great thing, you stick with it. Acorn Home Mortgage are just that....great."
More and more people have been shocked by the increased payments on their Home Equity Lines. Yes, we like Home Equity Lines but now with the larger payments, we are asking ‘what are my options to refinance and restructure the debt?’. Many people have great rates on their first mortgages and don't want to lose them. It is the second mortgage that is a real dilemma. Then the next hurdle is what if you still want to have a Line Of Credit to be available for home improvements, college education or weddings.
Does that mean you want a third mortgage? What do I do now?
First, you should assess all of your current debt. By this we mean mortgages (first and seconds), credit card debt, and other high interest rate loans i.e. Student loans. At this point, you should total the monthly expense with everything staying the same. Then you can determine if there is an opportunity to lower your monthly payment by restructuring your total debt through refinancing your mortgages. Even at today’s rates, there may be a significant savings. It is not about the interest rate on your first loan, it is about the total amount to be saved. A realistic goal would be to save at least one month’s worth of income over the total year. So, if you make $5,000 per month, you should want to save at least that over a year’s time which works out to over $400 per month. Over 5 years, this adds up to $25,000 in savings. In addition, this is not taking into account the possible reduction in your taxes that you pay. By restructuring your overall debt, you will shift payment from non tax deductible to payments which will be deductible.
So even though you have a great rate on your first mortgage, your overall debt may not be structured at the best interest rate. This is why you may want to have a discussion with a mortgage professional at Acorn Home Mortgage. We have staff in place to answer any your questions first to see what makes sense for you.
The bottom-line is to reduce your total debt not having a mortgage with a great rate that does not help to improve your cash flow.
If you have any refinancing questions, please contact us for a more complete analysis via secure email or call us on 203 682 0246.