Many homeowners are turning to a 30-year fixed rate mortgage in order to get a lower monthly mortgage payment. For many homeowners, there have been opportunities over the past few months to take advantage of very low interest rates that are being offered. Some homeowners have even seen record low interest rates when they chose to refinance.
However, refinancing is not a guarantee for a lower mortgage payment or a lower interest rate on your home loan. The rate and mortgage payment a homeowner gets if they refinance will depend on their credit score and the amount of equity they have built in their home.
There have been numerous homeowners who have been able to get a more affordable mortgage rate by refinancing to a 30-year fixed rate mortgage and as a result they saw their monthly payment drop as well. Some homeowners that have refinanced even got money back from the amount of equity they had built in the home and the more financially responsible of these people use that money to pay on their mortgage principal.
A homeowner who may want to refinance to a 30-year fixed rate mortgage needs to look at their personal financial situation and make sure it will be beneficial for them to do so. Homeowners also need to understand that a 30-year fixed rate mortgage is going to cost more over the long run than many other home loans. The lower monthly mortgage payment is usually what draws many homeowners to this type of home loan.
If you are looking for a more affordable mortgage over the entirety of the life of your home loan you may benefit from another mortgage, like a 15-year fixed rate mortgage, but if getting an affordable monthly payment is your goal then you may benefit from a 30-year fixed rate mortgage.
Homeowners are being advised to talk with their lender when it comes to making these decisions about their home loan. Homeowners that have been struggling to make their mortgage payments have been using refinancing as an option to deal with this problem but homeowners need to understand that refinancing also comes with costs and they have to be able to meet these costs before they refinance.