The kids are grown and finally out of the house. It’s that sweet “empty nest” time you’ve been hearing about, where you can turn Jr.’s room into your sewing haven, trade in carpooling hours for quality time on the porch or in the garden, and use that extra space in the garage for your DIY home-improvement projects. But what many newly empty nesters face is a hard-hit bank account that has supported years of select baseball tournaments, band camps, school tuitions, the neighborhood-favorite birthday bashes and more. To help bank accounts recover, many empty nesters downsize to a smaller house, especially if they have built up a lot of equity in their home. But to downsize or not is still a hard decision for most.
While downsizing may seem like a logical choice, the AARP reports that the majority of Americans want to stay in their homes permanently and live independently. If you fall into this category, refinancing is a great opportunity to lower your monthly mortgage payments, continue to build equity and save money over time. Refinancing is particularly beneficial when:
- Homeowners are living in a house that has greatly appreciated in value
- Mortgage interest rates have dropped 1/2 to 5/8 percent below your current interest rate
- Homeowners are early in their mortgage term, when payments are mostly directed toward interest vs. the principal
Refinancing provides homeowners the opportunities to:
- Change their loan from a balloon or adjustable-rate mortgage to a fixed-rate mortgage, lowering the risk of a changing interest rate
- Decrease their monthly mortgage payments by lengthening the repayment term or changing to a lower interest rate
- Benefit from lower interest rates
- Shorten the term of a loan, paying off the loan quicker
If you find yourself not ready to let go of your family home, and dreaming of grandkids filling it back up again in the future, consider a refinance option that can help you recoup some money while preserving your household memories.
PrimeLending simplifies the refinance process for homeowners every day. To learn more about which refinancing options work for you, contact one of our PrimeLending refinance experts.
From the PrimeLending blog, written by Mandy Jordan