The fourth largest city in the Bay area, Fremont was formed as a merger of five tiny communities in the late nineteen fifties. With a great school system, and the upcoming construction of a new Oakland A’s stadium in the area, it is not hard to see why so many people enjoy the Freemont Area.
Whether you already own a home in Fremont, CA that you are interested in refinancing, or you need a new Fremont, CA mortgage, the most important step is choosing the right kind of loan.
There are two reasons why people choose to refinance: either they want a new rate or term on their mortgage loan, or they need to access the equity in their homes and turn it into cash. Either way, you will need to replace your old mortgage with a new one, which means choosing a new loan.
If you want to access the equity in your home, but you do not want to replace your mortgage, a home equity loan or line of credit might be a good idea. A home equity loan offers you one lump sum of cash for the equity you have built on your home. A home equity line of credit offers you a debit card with access to your home’s equity. You will pay interest only on what you borrow with a line of credit. With a home equity loan, you will pay interest on all of it, no matter how you choose to use.
Types of refinance and mortgage loans
As the mortgage market continues to grow, there are many types of loans to choose from.
Adjustable rate loans come with low starting interest rates, which mean lower payments for you. You will choose an adjustment interval for your loan, usually one, three, or five years, and you will also talk with your lender about the kinds of caps he can set on your loan to help protect you from rising costs. Additionally, you will discuss the index your lender bases your interest rate on, which may help you to understand how it will change over the fifteen or thirty year term. After your adjustment interval is up, the loan is free to change with market conditions, your lender’s index, and the caps your lender has put on the loan.
Fixed rate loans are the other most common loan type. They come with higher interest rates than adjustable rate loans, but that interest rate will never change, and your payment will stay the same throughout the entire fifteen or thirty year period. These loans are great for people who need to stay on a budget.
Once you have considered the most common types of mortgage and refinance loans on the market, you may want to think about alternatives to these loans: products that might fit your monthly budget better.
Options ARM loans: For example, if you are self-employed, you might want some payment options each month with your new mortgage or refinance loan. The options ARM was created just for people like you. Choose from a minimum payment, an interest only payment, a fifteen-year amortized payment, or a thirty-year amortized payment each month. Whichever fits your budget best will work as a mortgage payment for that month.
Interest only loans: If you have a steady job, but you expect to see your income go up in the next few years, consider an interest only loan. With this type of loan, you will spend the first ten years making payments only toward the interest debt in your house. This makes a significant difference in the total payment amount. After the ten years are up, though, your payments will go up as well.
No matter what type of mortgage, refinance, or home equity loan you want, we can help. Take a moment to fill out the form below, and a qualified lender will contact you to discuss your Fremont, CA financing needs.
