Are you in St Louis and thinking about refinancing your mortgage? The Sean Z Team is here for you. We offer competitive rates, smooth applications, and excellent customer service.

Are you looking to cut the interest on your mortgage or shorten your mortgage term? Well, refinancing your home loan could be the perfect way of achieving this. But with the ever-changing market forces and life events, it can be difficult to tell the right time to do it. Below we have listed six tell-tale signs you should refinance your home loan.

1. Decreasing Interest Rates

Interest rates determine the amount of your monthly installment payment. When the interest rate is low, your monthly home loan payments will be lower. And you’ll save money. If the interest rates have dropped, you should consider refinancing. But what decrease is worth refinancing? Well, if the rate goes down by at least one or two percent, then it’s wise to refinance.

2. An Increased Credit Score

Your credit score matters a lot when it comes to mortgages. If your credit score was not appealing when applying for your mortgage, your interest rate might have been high. But if you have taken measures to build your credit score, such as improving your debt-to-income ratio and making timely bills payment, your current credit score might be higher. With a high credit score, you can get a better interest rate if you refinance your mortgage.

3. Your Income Has Increased

A low income at the time of application may force you into taking a long-term loan with a huge interest. But you may find a better-paying job in the future. When this happens, you might want to refinance your mortgage to reduce the interest. You see, when you refinance a 20-year mortgage loan to a 10- year loan, your monthly installment might increase, but you will end up saving more in the long run.

4. You Are Concerned About Your Adjustable-Rate Mortgage (ARM)

When your ARM initial term is over, you will realize that the rate will increase per the number of years in the agreement. And the new rates might be higher than what your income can comfortably accommodate. But you don’t need to struggle. Instead, you can take the easy way out by replacing your ARM with a fixed-rate mortgage you can comfortably finance.

5. You Are Approaching Your Retirement

If your retirement is approaching fast and you are worried your monthly payments are high, you can refinance your mortgage into a lower rate loan, which you will be able to finance when your income goes down.

6. You Want to Use Your Home Equity to Fund a Project

Do you have medical bills or college fees that need paying? Then, you can opt to cash out on your home equity through refinancing. Although this will increase your loan balance, it is far much cheaper than taking another personal loan.