The estimated average housing value in Arizona is currently higher than the average mortgage debt. While shopping around for the best deal, make sure to include these ancillary costs for a true picture of how much a refinance will cost you. If you are not able to secure a no closing cost refinance loan, some fees you may have to incur include escrow, title, appraisal, and credit fees. In some cases, a lender may collect money from the bank for managing to get a borrower into a high-interest loan in what is known as a yield spread premium. However, no closing cost refinance loans usually make up for this initial waiver of fees by requiring homeowners to pay a much higher interest rate on their loan. This type of refinancing loan can be beneficial to the borrower if they plan to resell the house within a few years for a higher value. This means that the lender pays all associated bank fees on the loan, including processing fees, and does not require any points to be paid. Some lenders offer refinancing loans that have no closing costs. Closing costs and fees associated with refinancing A longer term loan usually has lower interest rates. The length of the loan usually varies between 15 years and 30 years. Therefore, if a loan has a very low interest rate but 1 to 2 points, the borrower will need to pay 1 to 2 percent of the total value of the mortgage to the lender as soon as the paperwork is signed. Refinance mortgage rates in Arizona use a system that factors in the length of the loan and the number of so-called ‘points.’ Points are a term in refinancing that refers to a portion or percentage of the total home loan that is paid upfront by the borrower. What are po ints and how do they relate to refinancing? Read on for more details about refinancing options in Arizona. What are current interest rates at? If you refinanced to a fixed rate loan, would you save money over the life of your loan? How long do you plan to stay in your home – if it’s only a short period of time, an ARM loan might offer more benefits. Which product is right for you? Determining if refinancing with a fixed rate loan or an ARM loan is right for you will depend on many factors. 3, 5, 7 and 10-year ARM loans are common terms. Most ARM loans come with caps on how high your interest can change annually, as well as over the life of your loan, but your payments will eventually adjust. Fixed rate mortgages usually come in loan terms of 15, 20, and 30-years.ĪRM: An adjustable rate loan means the interest rate charged on the outstanding balance will adjust, usually after a short fixed period of time, as market interest rates change. Regardless of the ebbs and flows of the market, your payments will remain the same. Here are some core differences between the two products.įixed rate: As the name implies, a fixed rate mortgage means your interest will remain fixed over the life of your loan. There are two common products for refinancings, fixed rate, and ARM loans. What are your options? Refinance products in Arizona This opens the doors for plenty of refinancing options.Īrizona mortgage lenders and mortgage companies frequently offer home refinance loans that are custom tailored to offer the maximum benefit in terms of flexibility in payment structure for homeowners. This means many homeowners in Arizona could be in a great equity position. Refinancing in Arizona can also offer homeowners to secure cash on hand to make investments, pay for higher education, or even make a down payment on a second home.Īccording to data from CoreLogic, the average property value in Arizona is $140,439.30 and the average mortgage balance $118,105.40. Low refinance mortgage rates in Southwestern states, such as Arizona, allow home and property owners to save money on their long-term home loans.
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