Refinance
Refinance When It Actually Makes Sense
A refinance is worth it when the change pays for itself while you still have the loan. Start with what you want the change to do.
- No application required
- No credit pull to talk
What are you trying to accomplish?
See If Refinancing Makes Sense
Work out where your break-even sits before you decide anything.
Review My Break-EvenAccess Home Equity
Understand what equity actually is and what it would cost to reach it.
Explore My Equity OptionsCompare Ways to Access Equity
There is more than one route. Start with the goal, not the product.
Compare My OptionsConsolidate Other Debt
Sometimes this helps and sometimes it moves a short-term problem somewhere worse.
See How a Cash-Out WorksNot sure which one of those you are?
That is a normal place to start. Tell us what you are trying to do and we will work out which question you are actually asking.
Common reasons
Four common refinancing options
One Michigan point before any of them: a refinance does not uncap your home’s taxable value. The questions below say why.
Cash-Out Refinance
Your house isn't an ATM, so this one starts with why. A renovation, or debt with a plan to keep it paid off, can be a good reason. Spending that will come right back usually is not, because it replaces your whole mortgage to get there.
Compare the optionsMoving to a Fixed Rate
This turns on two dates: when your rate can next adjust, and how many months the new loan takes to pay back its costs. If the costs come back before the rate can move, the switch earns its keep.
About fixed-rate loansShorter-Term Loan
The trade is a higher payment for less interest over the life of the loan. It fits when the new payment still leaves room for savings and the things that break, not just when it fits on paper.
About the 15-Year FixedLonger-Term Loan
Room in the monthly budget now, in exchange for restarting the clock and usually paying more interest in total. Sometimes the monthly room matters more, and that is a fair call to make once you have seen both numbers.
Check the break-evenHome equity
Keep your first mortgage. Use your equity.
If your current rate is one you want to keep, a home equity loan or line of credit sits behind your mortgage instead of replacing it.
From a client who refinanced
In a client’s words
Did my refi with Samantha. What a smooth process. … [A]ll steps explained in a way I completely understood. Such a pleasure to work with!
Sarah Cadieux, client review. Individual experience. Results vary.
Questions about refinancing
If yours is not here, ask it on the call. There are no dumb questions.
What does a refinance cost, and where do I see it?
Closing costs, plus any points on the new loan. They are on page 2 of the Loan Estimate: Sections A to C are the lender and third-party costs, and E to H are taxes, prepaid items and the escrow deposit. Prepaid interest and the escrow deposit are not a cost of the change, because you would pay them anyway. Divide the real cost by what the change saves you each month and you have the break-even, counted in months.
What are the steps to closing?
An application, the documents for your income and assets, an appraisal unless the lender waives one, underwriting, and then closing. On a home you live in there is a three business day right of rescission after you sign, before the new loan funds.
What happens to my escrow account and mortgage insurance?
Your current servicer refunds what is left in the old escrow account within 30 days of the payoff, and the new loan sets up its own, so plan for a fresh escrow deposit at closing. Mortgage insurance depends on the new loan: a conventional loan with at least 20% equity, measured on the new appraisal, carries none, while a new FHA loan carries its own premium.
Does a refinance change my Michigan property taxes?
It does not uncap your taxable value. Under MCL 211.27a a mortgage is a transfer for security, not a transfer of ownership, so the cap stays in place. The bill still moves with the yearly inflation cap and any millage change.
A review can end with no change
Knowing your numbers and keeping the loan you have is a fine result.
- 1
Tell us what you are trying to do
Not what product you want. What you are actually trying to accomplish.
- 2
We look at your situation
Samantha works out what matters most for you specifically.
- 3
You leave with a plan
Your options, the tradeoffs, and your next step. No obligation to go further.
Align Lending LLC, NMLS #2041154, is a mortgage broker. Samantha Shelton, NMLS 1647301. Equal Housing Opportunity. Licensed in Michigan, Ohio, North Carolina, Florida, Louisiana and Texas. This page is for educational purposes only. It is not a credit decision, a preapproval, a commitment to lend, or an offer of credit, and it does not evaluate your eligibility for any loan program.
