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How Do You Refinance an Adjustable Rate Mortgage (ARM) loan?
How Do You Refinance an ARM loan?
If you have an Adjustable Rate Mortgage (ARM) then there are a few things you need to keep in mind.
First, your interest rate is not permanent and will adjust after a predetermined time period to a variable rate set by market indexes. The most appealing feature about this loan program is its introductory lower rate and payment. When the time comes for your mortgage loan to adjust, we invite you to revisit your mortgage and your financial goals.
Are You Approaching an Adjustment Period?
There is such a thing as “Payment Shock” and it can happen immediately after the ARM loan adjusts to a variable rate. (If you closed your ARM loan with NOVA, this can happen after 3, 5, 7 or 10 years. Depending on the loan type you have). This change can impact a borrower’s ability to afford a mortgage payment. If you are not prepared for the adjustment, wish to stay in your home long term or if you simply want to look into other financing opportunities, then this is the perfect time to look.
You Have Options!
There are several different variables that go into refinancing.
If you have been paying your mortgage for a while now and if you have equity on your home then refinancing can eliminate your private mortgage insurance premium (PMI).
If you plan on staying in your home long term, or if you have changes in your income or personal life then it may be advisable to switch to a traditional fixed rate mortgage. A stable mortgage payment will remove the element of surprise and will help you avoid paying more for your mortgage in the future.
If an ARM loan worked well for you the first time then you can also refinance into a new ARM loan. ARM’s will typically have lower interest rates than fixed-rate mortgages. Just keep in mind that your ARM will have an introductory period that will expire.
What Can We Do For You?
Our NO CLOSING COST REFINANCE PROGRAM allows us to extend your fixed rate period (in the 4% range or lower) based on the market today. NOVA ® will provide savings when you refinance that will allow you to make the switch to a mortgage program that is better suited for you.
Avoid paying more on your mortgage and consider refinancing your ARM loan!
Every situation is different, that is why you should schedule a conversation with a NOVA Loan Officer. There are many different reasons why an ARM loan might be perfect for you, but things change and your mortgage should too. We can help you find a loan program that is aligned with your future goals.
APPLY NOVA ® Home Loans, Today!
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