Guide to Refinance, Mortgage,
& Home Equity Loans in
Rock Hill, South Carolina (SC)

South Carolina is home to long summer days and mild winters. Rock Hill is further north and a satellite city of Charlotte, North Carolina. Whether you already live in Rock Hill or are relocating, you will need a place to live. It is important to know the options available to you in Rock Hill South Carolina, which is why speaking with a mortgage professional can be helpful.

Adjustable rate mortgages

An adjustable rate mortgage, or ARM, is a loan with a varying interest rate. This means that your interest rate may increase and decrease periodically during the life of the loan. The advantage to an adjustable rate mortgage is the initial low interest rate, which is usually around one or two percent. Another advantage is the shorter life span of 3, 5, 7, or 10 years. This means that you can pay off the loan in a short period of time, perhaps saving yourself some money in interest. The changing interest rate will affect your monthly payments, which could or could not be in your favor. Whether the interest rate increases or decreases, you may not know what your monthly payments will be in six months, making it difficult to manage a strict budget. Most of the time with an ARM, your interest rate will increase over the average interest rate available. This means that you may end up losing money. The best way to utilize an adjustable rate mortgage is during the first year or two of the loan, and then refinance at the appropriate time.

Fixed rate mortgages

This is the most common mortgage. A 30-year mortgage is one option you have with a fixed rate mortgage. A fixed rate mortgage has a fixed interest rate. It will not change during the life of the loan, and neither will your monthly payment. You can have a fixed rate mortgage for 15 to 40 years. The interest rate, and therefore the monthly payments you will have, will in determine how long you wish to have the loan. The longer you have the loan, the lower your monthly payments will be, but you will pay more interest.

Refinancing

As mentioned above, you have the option of refinancing your mortgage after you have had it for a certain length of time. When you refinance, the new loan you acquire will pay off the old loan. This means you will have a new loan instead of a second mortgage. Those who are struggling with debt often refinance to consolidate their higher interest rate debts and lower their monthly payments. When the interest rate is significantly lower than your current mortgage, it is often wise to refinance.

Home equity loans

A second mortgage is a home equity loan. A home equity loan does not pay off your existing loan. Instead, you gain another mortgage. This can be beneficial depending on your needs. If you need access to money for emergencies, remodeling, or paying off higher interest rate debts, you can procure the equity from your home. Equity is the appraised value of your home minus the amount owed on your existing loan. The benefit of gaining this money in a home equity loan is the lower interest rate, the lower monthly payments on the second loan, and having capital at the end of the transaction.

Please fill out the form below to find out your options in Rock Hill South Carolina today.