You’re working as much overtime as your boss will give you, clipping coupons, and buying generic brand groceries. Still, the debt keeps piling up, and you’re not sure where to go from here. Utilizing home equity to save money is a tried and tested method that has worked for many people in Alaska.
Refinancing Mortgages in Alaska
Mortgages are simply large loans that we use to buy a house. Just like loans, mortgages charge us interest. Unlike regular loans, however, mortgage interest rates are often significantly lower because of the asset attached to your credit – your home. By securing the funds you borrow with your house, lenders in Alaska are able to offer low and competitive rates. When we look at regular debt, you may be paying as high as 27% in interest costs, or more. In comparison, a mortgage rate can fall into the 2% - 8% range. Using the equity in your home, whether it be through a regular mortgage, second mortgage, home loan, or home equity line of credit, is a smart way to cut your interest costs and lower your monthly payments.
How Can Your Alaska Mortgage Save You Money?
How can your mortgage save you money? Take a look at all of the consumer debt you currently have. Most people hold three or four credit cards, a car loan, student loans, and a revolving line of credit. Make a list of all of the different interest rates you are paying on these various credit products. Then take a look at your mortgage rate. Chances are, if you refinance your mortgage your rate may go up or down slightly. The rate you’re at today is a good indication of what you could be paying for all of your debt combined. Is your mortgage rate significantly lower than the rest of your credit? Bingo!
By taking the higher interest rate debt you owe and rolling it into your much lower interest rate mortgage, you can save up to hundreds of dollars monthly in interest costs. Mortgages in Alaska often have two options when it comes to refinancing: either you can keep your monthly payments low to put more money in your pocket today, or you can make your payments slightly higher to account for the debt you’re paying off, thereby paying down your whole mortgage faster. Either way, both options put more money in your pocket – you’re just choosing if that money is now via smaller payments, or later via long term interest savings.
Does My Alaska Mortgage Qualify To Refinance?
The best way to find out if your mortgage can be refinanced is to talk to your financial advisor. Don’t be afraid to shop around and obtain different quotes. Each lender will have their own requirements for refinancing mortgages; depending on your credit score you may be able to use from up to 95% to 125% of the value of your house to refinance your debt. This means if your home is worth $100,000, your total mortgage could range anywhere from $95,000 to $125,000. At EHomeMortgages, we can help you find the right lender in Alaska with the best rate for your individual situation.