If you’re looking for ways to protect your money and own real estate, you should look into making sure that you’ve locked in a great rate while it remains low. There are a couple of options that you might choose, including downsizing, upsizing, and refinancing. Each option is valid, depending on the individual, and you can learn more about each option by reading below.
Upsizing and Downsizing
If you’ve always wanted a larger home or will need one in the next couple of years because of your growing family, now might be the time to upsize. People also choose to upsize if they’re working from home and will likely be working remotely for the next several years. For instance, if you were in a home that was just big enough for your family but began working from home when the pandemic hit, there’s a good chance that your home office is currently the kitchen table. If you know that you’re going to continue to work from home, you’ll be happy when you remedy this situation by upsizing.
Similarly, some empty nesters are realizing that having a big house is more expensive than necessary. Utility bills for larger homes are almost always more expensive than they are for smaller ones. Plus, cleaning and maintenance take more time. Downsizing might eliminate extra expenses, which can actually help people retire more comfortably and with less stress.
When you move to a smaller house with a smaller mortgage, you get to enjoy lower monthly payments on your existing mortgage, or you can take the equity and do other things with it. Plus, now is the time to get into a lower interest rate because you can save hundreds of dollars a month just in interest.
Whether you’re moving to a different house or just refinancing the one that you plan on living in for years to come, you’ll save a lot on the interest that you pay each month. When you refinance your loan, you’re able to tap into that lower interest rate. You might choose to refinance if you absolutely love your current home or just don’t feel like moving is the best option for you and your family.
Regardless of whether you refinance your home or buy a new one at the lower interest rate, you’ll be impressed by how much the savings stack up. For instance, if you currently have a house with a $300,000 mortgage at a 4% interest rate, you could go from paying $1,432 to $1,225 every month on your mortgage payments if you refinance to an interest rate of 2.75%. The exact amount that you save can depend on several factors, including the length of your loan, property taxes, and other loan specifications. The point is that you could save hundreds of dollars every month, and those savings will add up to thousands of dollars over the length of the loan.
The current housing and loan market opens up a lot of possibilities for homeowners to save money, and you should act soon before the interest rates go back up. If you’re looking for real estate companies in Estes Park to help you with selling a home, buying one, or helping you understand the benefits of refinancing your current home, talk to us to learn more.