It’s true, right now is an excellent time to refinance your home in Wilmington, Delaware. If you own real estate in the area, take advantage of everything our current economic landscape has to offer and refinance your home with DEXSTA Federal Credit Union. Refinancing your home can save you hundreds of dollars each month, and thousands of dollars over the lifetime of your loan. Here’s what you need to know to refinance your home in Wilmington, Delaware—and why the timing is right to refinance this winter.
If you are paying interest rates that are 1% higher than today’s current market rate, now is probably the best time to refinance your home in Wilmington. That’s because for every 1% reduction in interest rate you can secure, that reduces your monthly mortgage payment by $100 for every $100,000 that you owe. Over the course of your loan that can translate to thousands of dollars worth of savings.
Another reason you might be interested in refinancing is if you are currently on an adjustable-rate mortgage (ARM) and want to switch to fixed-rate loan or if you want to change the term of your loan. If today’s interest rates are at least 1% lower than the interest rate you are currently paying, and you want to change your loan from a 30-year loan to a 10-year loan, you could be looking at significantly reduced mortgage payments—and a far shorter lending period.
Your credit rating is a significant determining factor when it comes to applying for a home loan. Poor credit scores can equate to higher interest rates and higher mortgage payments. However, if your credit score has gone up since you first purchased your home, you might be able to receive reduced interest rates on your home loan. In fact, you can reduce your interest rate by up to 1.5% simply from an improved credit score alone. Check your credit score—if it’s above 760, you may qualify.
It’s impossible to predict whether or not interest rates will increase in the future. However, we do know that the Federal Reserve raised short-term interest rates last summer. Though this hasn’t always been a determining factor of mortgage interest rates, it is a vote of confidence for our economy. As our economy strengthens, so does our real estate market, and when real estate demand is high, so are interest rates. As conventional wisdom goes: when interest rates are falling—wait. When interest rates are rising—lock it in.
DEXSTA Federal Credit Union offers home equity loans at competitive market rates. We are a not-for-profit organization serving New Castle and Kent County Delaware or Cecil County Maryland and would love to help you refinance your home in Wilmington, Delaware. Contact us for more information!