This is historically an excellent time for homeowners in Texas to get their mortgage refinance from a Texas mortgage broker. The reason is that the private banks that run the U.S. economy have seen what is going on in the housing market, and now the chickens have come home to roost for their friends on Wall Street – so they’ve taken interest rates down to their lowest levels in years.
What does this mean to the average Texas home owner?
It means it’s a great time to eliminate unsecured debt, improve one’s credit score, gain potential tax benefits and lower monthly payments. And, if you’re in an adjustable rate mortgage, this is your chance to get out and lock in a fixed rate for the duration.
The most common reason that Mortgage texas refinance their homes today is to pull cash equity out of their homes and pay off unsecured credit card debt. This alone can have several benefits:
- Lower interest and payments: Some credit card companies have raised interest rates to as much as 29% - on people who have good credit! If you read the fine print of most credit card agreements, you’ll find that they can raise a customer’s interest rate at any time for any reason. With a home equity line of credit, the interest rate is locked in for the duration of the loan, and is lower – sometimes much lower – than what the average credit card interest is. This translates into lower payments each month (particularly since Congress has now allowed credit card companies to double their minimum payments).
- Improved credit score. Each time a loan is paid off, it shows up as a positive mark on your credit report. Although the home equity loan will show up, it is a secured line of credit, which is much more desirable to have on one’s credit report than unsecured credit card debt.
- Tax advantages: Since the Tax Code was massively reformed under the Reagan Administration in 1982, working people no longer have the right to deduct credit card interest from their taxes. However in most cases, the interest of a second mortgage is fully deductible from one’s taxes – meaning substantial savings come April 15th.
- ARMs: If you are in one of these, get out now! These “adjustable rates” will invariably adjust upward; already, many Texas homeowners are seeing their house payments go up several hundred dollars a month, even while the value of their homes are dropping. Refinancing will make sure that your house payment remains stable, no matter where interest rates go in the future – but you must act now in order to lock in that low rate.
Call your Texas mortgage broker today. Regardless of your credit situation, there is a program for you.
