Are you a homeowner in Roy, Utah? Are you in need of extra money? You have two options available to you: A refinance loan or a home equity loan.
A refinance loan is actually a new loan that replaces your existing loan. You will choose a new mortgage type, a new interest rate, and a new mortgage length. Since you are applying for a new loan, you will have to fill out a loan application and provide the personal and financial information necessary to qualify for a loan as you did for your existing mortgage. This money can be used for anything from remodeling your home to paying for a family vacation.
A home equity loan allows you to borrow money on the equity you have earned in your home. This money is available in the form of a line of credit or a lump sum payment. Home equity loans have a 10 to 15 year term. If you have unexpected medical bills, college tuition, or are in need of a new car, this loan is the right thing for you.
If you are relocating to or have just found your dream home in Roy, it is important to find an experienced loan officer to guide you through the loan process. Your loan officer will be able to explain the many mortgage packages available on the market today.
Mortgage Types
With so many mortgage types available, it is important to understand the basics. Common mortgage types include fixed rate, adjustable rate, balloon, and interest-only. Fixed rate loans have a set interest rate, which, in turn, allows you to have the same mortgage payment every month for the duration of the loan. Fixed rate loans usually have terms of 15 or 30 years. Adjustable rate loans start out with a low interest rate but this rate can change at 1, 3, or 5 years depending on the predetermined intervals of your loan. Your mortgage payment will increase or decrease contingent on the interest rate at these times. Balloon mortgages will have the same interest rate throughout the duration of the loan but has to be paid in full at the end of 5 years. Interest only mortgages allow your mortgage payment to pay only the interest for the first 10 years. The principal is added at that time, which will increase your mortgage payments.
Your loan officer will have current information regarding different mortgage types. Together you will be able to find the one that is right for you.
Closing
The last step in the loan process is closing. At this meeting, you will be asked to sign multiple copies of numerous documents, which will include a Truth in Lending Statement, a monthly payment letter, the note, and the mortgage itself. Other real estate documents will also be presented. You will pay your closing costs and down payment at this time also. Closing usually lasts about an hour but make sure you’ve set aside enough time just in case problems arise.
Options for Existing Homeowners
Two options available to homeowners in Roy, Utah are refinance loans and home equity loans. Both of these options will give you money to pay off credit card bills, medical expenses, remodeling or repairing your home, college tuition, or even for a family vacation.
Qualifying for a refinance loan allows you to replace your existing mortgage. This is especially beneficial if you have an adjustable rate mortgage and anticipate higher interest rates or you have a higher rate on a fixed rate mortgage and interest rates are down. You will need to go through the same loan process as you did in the past. The obvious benefits of having a lower mortgage payment is that it frees up money you can use for other purposes.
A home equity loan allows you to use the equity you have built up in your home to borrow money. Home equity loans usually have durations of 10 to 15 years. The money is available to you in either the form of a line of credit or a lump sum payment. You can spend this money any way you want. You will only pay interest on the money you borrow.
Contact one of our knowledgeable loan officers today to discuss your lending needs in Roy, Utah.
