Ways To Win As A Homeowner, Even In A Tough Rate Environment

In the last few years the interest rate environment has been very uncertain, rates have fluctuated from historically low (during the pandemic) back to the more moderate rate environment that we currently sit in. Recent history has conditioned us feel that the current rate environment is unbearably high but if we look back over time – think early 80’s – we are actually in a fairly decent rate environment (https://money.usnews.com/loans/mortgages/articles/historical-mortgage-rates). The truth is, as a homeowner, equity position and subsequent equity opportunities can be just as impactful as rates are. This is why it’s important, regardless of what the rates are today, that you have a trusted mortgage professional on your side to help you review your loan and opportunities that may exist.

Ways Homeowners Can Still Win, Even In A Tough Rate Environment

Whether you are locked into a 2.5% interest rate or got in at 7.5%, you still are building equity in your home! If you have been in your home for at least a few years you may already have sizable equity built between paying your mortgage and home appreciation. If you aren’t planning to sell, some may think there is no need to review your mortgage or worry about equity, but those people would be wrong! Here are a few things to consider as a homeowner relating to equity and refinance opportunities:

Know Your Current Mortgage Rate and Term

The current market rates may not be lower than what you have right now but there still may be an opportunity for you to benefit from a review. It is important to take a look at your current mortgage statement and identify your current rate, remaining loan term, principal balance, loan type and what your mortgage insurance premium is monthly (if applicable). This provides you a baseline of information that allows you to assess whether you are potentially missing out on any opportunities. If you are unsure where to locate this information, reach out to a trusted mortgage partner for their help. Even if your mortgage isn’t with them today, they should know how to help you find the information you need!

Will You Stay or Will You Go?

The second question you need to answer when reviewing your home mortgage situation is whether you intend to stay in this home for an extended period of time. Is the home still meeting your needs? Do you anticipate any major changes coming in the next few years that might cause you to reassess your home needs? IE Getting married or divorced, having children, children graduating and moving out, major job changes, etc. If any of these apply it’s imperative you have an honest conversation with a mortgage expert on how these changes may impact your housing needs.

Has Your Life Situation Changed Drastically?

Not one of us has been immune to the financial changes and hardship that have hit our world the last few years. With this in mind, it is important to acknowledge that a payment that may have felt palatable at one time, may no longer feel that way. You may have taken an aggressive approach to paying down your mortgage when you originally financed it by choosing a 15 year loan. While rates may not be lower today, reviewing your loan for refinance opportunities can allow you to discover if there may be options to extend the term of your loan to potentially lower payments.

Alternatively, you could have been in a situation where you didn’t have a lot of money to put down and now you are stuck with mortgage insurance. Reviewing your loan with a local mortgage expert will help to determine if there are any options to eliminate the mortgage insurance on your loan which would impact your monthly payment obligation.

If your circumstances have changed, it’s never a bad idea to have a conversation with a local loan officer who reviews financial options day in and day out.

Major expenses impending?

Do you have some major changes heading your way? Maybe you have a kid who is getting ready to go off to college or has just gotten engaged and now there is a wedding to pay for. Maybe your paid off and reliant vehicle is feeling not so reliant these days. Maybe you thought you were into the stages of kids being off to school and running around with sports when SURPRISE…you have another on the way.

Regardless of whether the aforementioned circumstances sound familiar or there is another situation that has occurred that comes with some extra expenses you didn’t count on; people often forget about the equity in their home being an option to leverage. If you have been paying your mortgage, you have been building equity – albeit a very small amount at first on a 30-year loan. Speaking with a mortgage expert can help you understand what options you may have in tapping into the equity in your home to be able to finance some of the curve balls life throws you.

Some people may be opposed to this option on the surface as they may feel they have worked very hard already to build that equity and they don’t want to take away from it. The truth is though, if you are going to be borrowing money to finance something, often times home mortgage and home equity options do come with a lower price tag than that of alternative consumer debt.

Create A Space That Meets Your Needs

If you have been in your home for at least a few years and it just isn’t quite meeting your needs any longer a renovation or remodel might be able to help you update or upgrade your home without having to relocate. Most people aren’t budgeting for something like this so are unsure how it would even work or how they would pay for the work and materials; it is always advisable to review your options before you get too far down a path. So before you start tearing down walls or pulling out floors, reach out to your local mortgage expert to discuss options that might allow you to borrow funds at a lower than standard consumer debt rate by tapping into equity in your home through an equity line or possibly even using a renovation loan to borrow money based on the value of the home after the work will be completed.

Get Intimate with Your Finances

The savviest thing a penny-wise person can do is to evaluate all of their debt and the associated interest rates to see how much they are paying in finance charges. Whether it’s a loan or a credit card, ultimately when you are “borrowing” money you are buying money. With household debt reaching $18.20 trillion during Q1 of 2025 (https://www.newyorkfed.org/microeconomics/hhdc), most people are no longer able to avoid being part of the consumer debt crisis in some way. While we would all love to have no debt and zero percent interest rates when we do have to borrow, that isn’t reality.

So how do we get an intimate understanding of our overall financial situation and what does that have to do with your mortgage? Well, a good start is to sit down pull a free credit report off www.Annualcreditreport.com to determine what debts you have out there; once you have this in hand you will have a snapshot of your consumer debt picture. You should then track down your statements or login to each of your accounts to determine the interest rates and monthly payments being charged on each debt. If you have a substantial amount of consumer debt, high interest rates and/or balances and you have equity in your home it’s time to reach out to your favorite local mortgage expert. They will utilize the tools they have to review your blended rate and review consolidation opportunities, if they exist. There may be opportunities to lower your interest rates on high balance or rate accounts, consolidate payments to simplify paying your bills and there may even be a chance to lower the monthly amount rolling out of your account.

A versed mortgage expert will check into home equity and refinance options for you if they believe that there will be a benefit to your overall financial situation.

Time To Call The Loan Officer.

Is refinancing right for you? Is now the best time for you to refinance? You can research these questions and more online, but the most proven way to get accurate information about your unique situation is to find a loan officer. Contacting a loan officer is free while the information and guidance they provide are invaluable. Plus, you are in no way obligated to move forward with an application. Want to get started now? Complete our Quick Start Form and we’ll connect you with a loan officer that matches your specific needs. They’ll provide a free consultation and guide you through every step of the loan application process.