Can I refinance an ARM mortgage?

How to refinance an adjustable-rate mortgage?

Refinancing an adjustable-rate mortgage (ARM) can be a smart move, particularly if you’re concerned about future interest rate increases. It can also make sense if you’re looking to lower your mortgage payment, take cash out of your home, or

Refinancing your ARM into a fixed-rate mortgage offers greater peace of mind with steady monthly payments. The process may require some time and a bit of paperwork, but it can be an invaluable step towards financial security. So, let’s dive in and explore how you can successfully refinance your adjustable-rate mortgage.

Are you ready to move out of your ARM to reduce payments, shorten the term, or take cash out of your home? You can either continue reading to learn more about ARM refinancing, or start your application.

Which mortgage types can I refinance my ARM into?

There are several different mortgage refinance types that you can switch your ARM into.

Popular refinance options are usually moving into a fixed-rate mortgage or another adjustable-rate mortgage.

The best choice for you really depends on your financial situation and future plans.

A fixed-rate mortgage often works because your monthly payments stay the same. The interest rate won’t change for the life of the loan. This is a great choice if you’re planning to stay in your home for a long time and like having that predictability.

It’s also possible to refinance into a new adjustable-rate mortgage. With a new ARM, you might get to take advantage of lower initial interest rates. Keep in mind that your rate could go up in the future. This might be a fit if you’re thinking about selling your house before the rate adjusts.

Can I refinance from an ARM into a government loan?

Yes, refinancing an adjustable-rate mortgage (ARM) into a government loan is possible.

If your ARM is nearing its adjustment period, securing a fixed-rate loan could save you money. Government-backed loans, such as FHA or VA loans, are great options for refinancing because they often offer lower interest rates and forgiving credit requirements.

However, it’s important to remember that eligibility rules still apply. You’ll need to speak with one of our experts to make sure you qualify.

What are the benefits of refinancing from an ARM to a fixed-rate mortgage?

Refinancing to a fixed-rate mortgage can offer peace of mind and the security of knowing exactly what your financial commitment will be. We already mentioned how a fixed-rate mortgage doesn’t see the rate adjust like an ARM does. However, there are additional benefits to refinancing from an ARM to a fixed-rate mortgage.

Are current market rates are lower than the rate you’re paying on your ARM? If so, refinancing into a fixed-rate mortgage can save you a significant amount of money over time. With a lower rate, a higher portion of your payments goes toward the principal rather than interest. This can help you pay off your mortgage a bit quicker.

Also, since your monthly mortgage payment stays the same, it becomes easier to plan your finances and avoid any surprise increase in your payment amount. It offers homeowners predictability, which can be enormously beneficial in managing long-term finances.

While refinancing might not be the best solution for every homeowner with an adjustable-rate mortgage, it does bring numerous benefits for those seeking stability and potential savings in their home financing. Connect with an expert to discuss your refinance options and better understand if they can help you meet your goals.

Is it a good idea to refinance from an ARM to a fixed-rate mortgage?

Choosing to refinance your adjustable-rate mortgage (ARM) to a fixed-rate one can be a smart move, especially if you can get a lower rate or a reduced mortgage term.

With an ARM, you risk facing a significant increase in monthly payments if rates rise. However, with a fixed-rate mortgage, you can lock in a low rate for the life of your loan, providing predictable and steady payments.

However, do remember, refinancing also comes with costs. It’s essential to ensure that the savings you’ll make from a lower rate outweigh refinancing expenses. Seek expert advice to make an informed decision. 

Are there costs associated with refinancing an ARM?

Refinancing an Adjustable-Rate Mortgage (ARM) isn’t free and there will be some costs you’ll have to manage. You’ll encounter various fees such as closing costs and potentially early payment fees.

However, the exact cost can vary depending on several factors such as your lender, loan size, and location. It’s essential to consider these costs and calculate if refinancing will ultimately save you money in the long run. 

Are there costs associated with refinancing an ARM?

Are you ready to start the mortgage refinance process? If you want to move out of an adjustable-rate mortgage to another option with a lower payment, reduced term, or to take cash out of your home, a refinance may be the answer. Start the process by applying today, and see if a mortgage refinance makes sense for your financial goals!

Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Restrictions may apply, contact Owning for current rates and for more information.

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