Short Term Mortgage – Let’s talk about the pros and cons that lenders wont tell you!

Refinancing to a 15 year mortgage is not right for everybody. Stay with me through the end of this video. And you will know if refinancing into a shorter term loan is right for you. And I’ll make sure you have my checklist at the end as well. I am Janine Sasso, local real estate agent in Schaumburg Hoffman Estates and Barrington Servicing the northwest suburbs of Chicago. So you’ve been in your home for a while and are wondering if you should refinance short or long term. Might be able to let you pay off your home faster. But there’s got to be a drawback right now. Let’s look into it today. Refinancing into a shorter term will most likely increase your payment under normal interest circumstances. So we are saying the interest rate remains the same, but your loan term is actually getting shorter. Most likely your payment will be going up.

This is something to keep in mind if you are already on a tight budget. So how will you know if it makes sense? If you do decide to refinance. Make sure you are comparing a few lenders for the best possible rate and term. Here’s another fact a refinance might be right. If you’re looking to be facing some tough decisions that are coming towards you in the near future. We’re talking maybe job loss income that becomes decreased or if you have to cover financial emergencies when you are considering to refinance. Consider how this new monthly mortgage payment will be impacting your overall budget of debt repayment, utilities, general cost of living, emergency repairs, and adding to your investment and retirement savings as compared to your current mortgage payment.

You can pay off your mortgage faster by simply making an additional mortgage payment. Periodically, the catch your interest rate will remain higher on the longer term loan than if you were to refinance to the shorter one. Financing to a shorter term loan can actually tie up some of your cash that could be used differently. So instead of refinancing, maybe consider bumping up your padding on your for one case, your retirement savings or even your investments. This money might be working for you a little bit better than tying it up into your home. But wait, there’s more. It’s strategic about your refinancing goals. Really make sure you evaluate the long term, the short term, the goals that you have and the planning that gets into it.

Not everybody will have the same answer after looking at all those things we just covered in this video. I hope you found this helpful. And make sure you subscribe to my YouTube channel. Ring that bell. My name is Janine Sasso. I’m your local Schaumburg Hoffman Estates, Barrington and surrounding suburbs realtor right here in the Chicagoland area. And I cannot wait to see you in the next video.

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