Looking for the very best Tucson refinance rates? With so many homebuyers struggling to make ends meets, stay employed and pay their mortgages it's no wonder that refinancing has become such a popular option.
Refinancing can be a useful tool, or it can be just one more way to get in over your head. Here in Tucson, we face many of the same dilemmas as the rest of the country.
The benefits and drawbacks of refinancing, area specific factors, and the process involved are all things you will want to consider before deciding if this option meets your financial needs.
Why Tucson Refinances are so Popular
There are several reasons that folks in Tucson, Arizona consider refinancing their primary mortgages. The most common ones are to get a lower interest rate, to obtain lower monthly payments, to find funds for home improvements, to find funds for other needs, and to consolidate other loans. People use this money to put kids through college, repair leaking roofs, pay for medical needs and a whole slew of other things. What you need to do is determine is exactly what the purpose of a refinance is for you, and then decide if it makes good financial sense.
How to Crunch the Numbers
For example, let's say that you want to refinance your home in order to reduce your monthly mortgage payment. Since the average annual pay rate in Tucson is about $28,000 per year, it's not surprising that many homeowners are doing anything they can to cut costs. The average pay for US Cities over all is slightly above $34,000.
If that average wage earner in Tucson wants to refinance, and the closing costs and other fees are going to run at $2,000 then he or she needs to figure out how long it will take to break even and eventually save money. Let's say that this person determines their monthly payments will be reduced by $50 a month. Just divide 2,000 by 50 and it you see that it will take 40 months to break even. If this person can save $75 a month then (2000/75=27) it will take only 27 months to break even. After the break even point, both folks will start to save the monthly amount.
If you are already struggling to make your monthly mortgage payment, and this will allow you to pay your bills, it might be a good idea.
Questions to Ask About a Tucson Refinance
Before you decide that cutting that monthly mortgage payment is so alluring you are ready to sign up for a Tucson refinance today, there are other factors to consider. Your eligibility, current rates, and the status of your current home loan are all important points. Lenders are traditionally willing to write refinance loans for about 75% of a home's current equity. Even though those are a lender's standards (and each one is a little different) you should have some standards of your own. Here are some great questions to ask your self:
Do you have enough equity to pay off the loan amount you currently owe plus the costs and fees attached to the refinance? If you don't, you might want to look into different options. In fact, you might not even qualify. Just remember, qualifying for a loan does not mean you can afford a loan. This often overlooked fact is what got so many homeowners and lenders into the sticky situation that pervades Arizona and the nation.
Is the going interest rate at least 1.5% lower that the rate you are paying on your current home loan? If it's not, it is probably not in your best interest to spend the money on refinancing.
How much longer do you have remaining on your current home loan? If you've only got 5 or 6 years left, you might want to rethink refinancing. This is because the loan period will reset, probably to 30 years. That's 30 more years of interest payments rather that the 5 or 6. If you can make it to the end of your loan in this scenario, you will probably be better off.
Where to Go for the Best Tucson Refinance Rates
Living in the second largest city in Arizona, the one million plus residents of Tucson have plenty of options and companies to go to for a refinance. Some of the local mortgage brokers you may consider are Answer, Pinnacle Mortgage, Valley National and Tucson home loans. Or you can proceed through a number of real estate brokers such as the Real Estate Store, Roy H Long Realty Company, La Canada Companies, Homes of Old Pueblo and Help U Sell Southeast Rita.
Before you contact any one individual company, you may want to do a quick comparison shop with our online tool that will get refinance rate quotes from several companies for you to compare. This allows you to see the rates and call and ask your remaining questions to the most promising companies. Plus, this means you can start the process without leaving the home you are working to protect.
Enter your zip code in on the top of the page and get started comparing Tucson AZ refinance rates today!
