• Post last modified:October 5, 2020
  • Post category:Insurance

Since interest rates have been hovering at historic lows for a while now, if you’re a CT homeowner, then chances are that refinancing your home has probably entered your head.  While this is a great way to structure a better deal on your home and pay lower monthly installments, there are a few things you should know and look out for before you sign on the dotted line.

The first thing you absolutely need to know is the true value of your home, TODAY.  While you may have payed say $250,000 for your current residence eight years ago, with the financial crisis only a few years back and the continued sluggish growth of the economy and housing market, chances are you’re home is worth less than you think.  If you go into a meeting with your lender thinking your home commands a far higher price than the lender, you’re in for a long day.

Remember that interest rates aren’t the only thing to look at.  The goal of refinancing for CT homeowners obviously is to get a better deal on your mortgage and pay a lower monthly installment, but look at the big picture first.  Make sure you’re aware of new clauses within the new deal such as restrictive terms for late payments. Moreover, if you only have a couple years left on your mortgage, don’t be fooled into accepting a refinanced loan for another twenty years.

Additionally, look at all the costs associated with refinancing.  While the new interest rate you receive may be great, make sure you look at ALL the costs included with refinancing- credit checks, closing costs, home appraisals, etc. You could be out a substantial amount of money and only receive a one percent less rate in return.  Additionally, every CT homeowner should be aware of adjustable rates that seem great to begin with, but remember, they’re called adjustable for a reason.  That rate could quickly balloon.

Remember to always look at the big picture when it comes to any type of home costs- refinancing, equity loans, and of course, CT homeowners insurance. We at Paradiso Insurance want all of those in our community to have the right tools and knowledge necessary to live a happy and successful life, without the headache of financial troubles.  Give us a call today with any questions you may have!