Guide to Refinance, Mortgage,
& Home Equity Loans in
Bend, Oregon (OR)

Bend , Oregon is a beautiful city. Rainfall in Oregon brings out the vibrant greens, creating the lush forests for anyone to walk in. Bend has a population of over 75,000 residents. Part of the draw of Bend is the year-round recreational activities and growing economy.

If you are one of the individuals moving to Bend for the growing economy, you are going to need a home and a mortgage. Mortgages are loans from a lender that allow you to purchase a home without having the entire sale amount in your bank account. Two of the most common and least complicated mortgages are adjustable rate and fixed rate mortgages.

Adjustable Rate Mortgages

An adjustable rate mortgage is a loan with a variable interest rate. This means over the life of the loan your interest rate may change every few months or annually. This is not such a bad deal when the interest rate stays lower than the current market rate; however, the interest rate may increase to more than you can handle with monthly payments over the term of the loan. The advantage to the adjustable rate mortgage is that the initial interest rate will be around 1% or 2%. An adjustable rate mortgage has a short life term than a fixed rate mortgage causing a higher monthly payment. The term of adjustable rate mortgages can be 3, 5, 7, or 10 years. This is mostly because individuals decide to refinance once their interest rates are raised.

Fixed Rate Mortgages

A fixed rate mortgage is defined as a loan with a fixed interest rate over the life of the loan. With this type of mortgage, your monthly payments will remain the same over the term of the loan, which can be 15 to 40 years. The most common term of fixed rate mortgages is the 30-year mortgage. This allows for the best interest rate and monthly payments. The advantage to a fixed rate mortgage is locking in one interest rate and knowing what your mortgage payment will be for your budgeting purposes.

Refinancing

Refinancing is a way to obtain a lower interest rate when the interest rate is more favorable than your current loan. Refinancing pays off your existing loan with a new loan. You might also consolidate other higher interest rate debts to streamline your expenses during refinancing. Another advantage to refinancing is changing from an adjustable rate mortgage to a fixed rate mortgage in order to obtain a steady monthly payment.

A home equity loan is another financial option for those who already have homes and are looking to lower their monthly expenses or need a little cash. A home equity loan, unlike refinancing, does not pay off the existing loan. Most commonly you will hear home equity loans referred to as a second mortgage. This mortgage allows you to gain the equity you have built up in your home. The lender will look at the appraised value of your house minus the amount owed on your existing loan to determine the amount of equity you have. They will then produce a check at the end of the process for you to deposit. This money can be used to pay off higher interest debts, student loans, medical expenses, or perhaps take a vacation. Whatever your needs, a home equity loan is designed to help you with your debt. Home equity loans also have a special low interest rate, making your monthly payments manageable and possibly lower than paying out for three different expenses instead of one.

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