Refinancing Your Mortgage In California
The reasons to do a refinance in California are usually different from one homeowner to the next. Some homeowners in California look to refinance to obtain a lower mortgage rate. Others look to refinance their current mortgage to get cash out so they can improve their home. And some homeowners look to refinance so they can shorten the length of their mortgage from a 30 year fixed rate mortgage to a 15 year fixed rate mortgage.
We’ll Cover The Following Topics:
Reasons to do a refinance: We cover all the reasons in which a homeowner may want to consider a refinance. From obtaining a lower interest rate to obtaining cash out to changing from a 30 year fixed rate to a 15 year fixed rate mortgage.
Resources you can use: Here we provide information and links to current mortgage rates, and general homeowner news. Current mortgage rates are generally updated daily. For a quote you can contact us directly through our website or call 1-800-550-5538.
When not to do a refinance: We give specific examples of when homeowner should not do a refinance. If you are moving in the near future or remodeling your home or close to paying off your mortgage; it’s important to know when not to do a refinance.
A team of professionals: Working with a team of professionals is so important when refinancing your home in California. A mortgage company and a Loan Officer with experience and a solid reputation can save you thousands of dollars.
Loan programs: Picking a the right loan program is one of the biggest steps during the loan process. On koloans.com we have all the information needed to make an informed decision on what’s best for your current situation.
Current guidelines: Here is a brief overview of current guidelines for those looking to refinance their home in California. Like mortgage rates; guidelines can change frequently and without notice so if you have a specific question please be sure to ask.
Is now the right time to refinance: We cover the two most important questions you should ask to help determine if now is the right time to refinance.
Less than perfect credit refinance: Here is where you’ll find some good information and facts for those looking to refinance that have less than perfect credit.
At JB Mortgage Capital, Inc. we offer low rate mortgages to homeowners in the state of California. We’re a top rated mortgage company with the California Better Business Bureau (A+ rating and we are accredited). We also have a “AAA” rating with the California Business Consumer Alliance (BCA) and a five star rating with Zillow and Mortgage101. We employ the latest technology to ensure we keep our costs low and the process quick. Making sure our clients are 100% satisfied is our top priority which is why we work one-on-one one with all our clients. We truly enjoy assisting our clients with obtaining the best possible mortgage rate.
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Reasons Why You May Want To Do A Refinance:
We’ll cover so of the most popular reasons why a homeowner in California would consider a refinance.
A Lower Mortgage Rate:
Obtaining a lower mortgage rate is one of the main reasons a homeowner would want to consider a. refinance of their current mortgage. Some homeowners think you need to save at least 1% – 2% to consider a refinance however that is not the case. For example; if you had a 4.50% 30 year fixed rate mortgage (with an original loan amount of 300k) and you had the opportunity to refinance into a 30 year fixed rate mortgage 4.00% you could save over $7,000 on your monthly payments (dependent upon your new loan amount) over the first 5 years.
Does it always make sense to refinance with less than 1% drop in rate? No but it is worth looking into if you can at least drop your interest rate by .50% or more. The value of the refinance also depends on the amounts fees being charged to do the refinance.
Wether it’s to improve the home, pay for a medical expense or help cover the cost of college tuition; doing a cash out refinance has its benefits when used properly. We suggest avoid taking cash out to use for vacations and shopping and use a cash out refinance to improve your current financial position. And there are times when you need to do a cash out refinance due to a difficult situation (like medical expenses) and it’s important to do so wisely.
Using a cash out refinance to improve the home ads value to the property; paying off high interest debt improves your monthly cash flow and potentially saves you thousands of dollars in interest. If you’re using the cash our refinance to pay for college that provides a long term benefit to your family.
Short Loan Term:
If you have a 30 year fixed mortgage rate or a 20 year fixed mortgage rate you may want to consider shortening the length of your mortgage to a 15 year fixed rate or a 10 year fixed rate mortgage. The benefits are you’ll have a. lower mortgage rate and pay less total interest however your payments are usually higher. Always keep this in mind when moving to a. shorter term: make certain you can afford the higher payment.
Whatever your reason might be it’s important to review your options and be prudent in your decision making. A cash out refinance is an important transaction and using all available tools and resources will make the decision process easier.
Getting Rid of Mortgage Insurance or Private Mortgage Insurance:
If you bought a home in California and obtained your current mortgage when you had less than 20% equity in your home you might want to consider a refinance if home values in your area are high enough and/or your loan balance is low enough. A FHA home loan in California is a great program for those that need it however when there is an opportunity to get rid of the Mortgage Insurance premium it’s something you should strongly consider. In some cases a California homeowner can save $200 – $400 per month without even lowering their interest rate if they refinanced their current mortgage.
Moving From a Fixed Rate Mortgage to An Adjustable Rate Mortgage:
If you have an adjustable rate mortgage you may want to consider a refinance of your current mortgage and lock in a long term fixed rate. Adjustable rate mortgages are popular in California and they provided a lot of benefits however the rate adjusts after a certain number of years. To protect yourself you may want to refinance your current mortgage so that you avoid that adjustment period. When moving from an adjustable rate mortgage to a fixed rate mortgage make sure you keep your closing costs low and review all your options.
Resources You Can Use To Save Money
When Not To Do A Refinance:
We covered when it was a good time to consider a refinance of your current mortgage; now we’ll touch on when it’s not a good idea to refinance.
You’re Moving In The Near Future:
If you are moving in the next 6 – 18 months your best option is to probably stick with the mortgage you have unless the interest rate is really high and current rates are really low and you can obtain the lower interest rate with little to no cost.
You’re In The Middle of Remodeling Your Home:
If you are currently remodeling your home; you might want wait until the remodel is done are close to be being done (within a few weeks) before you start your refinance application. While a homeowner can sometimes obtain an appraisal waiver with a refinance; most of the time you have to get an appraisal done and if the work is significant the mortgage company will request it be completed before the refinance closes.
You’re Close To Paying Off Your Mortgage:
If you have less than 10 years you may not want to do a refinance unless the interest rate is significantly lower than what you currently have or there’s a need to do a cash out refinance. Other than that you probably want to avoid doing a refinance.
The Costs Associated With The Refinance Are Too High:
When doing a refinance you want to not only look at the term, interest rate and payment but you also want to focus on the costs associated with doing the refinance. Doing a refinance with significant costs is rarely if ever a good idea. Always do a break-even analysis to determine how long it will take to make up for the costs associated with the refinance and determine if that time frame is acceptable to you.
The Lowest California Refinance Rates:
Every consumer is looking for the lowest California refinance rates and at JB Mortgage Capital, Inc. we strive day in and day out to provide that to our clients. It starts with how we utilize the latest technology to not only help close your transaction as fast as possible but also to help keep our costs down. We also have a unique way of doing business as well that provides the client with a better overall experience and further reduces our costs when it comes to processing your application. Most mortgage companies In California will pass you from one department to the next during the loan process. In some cases the borrower will work with as many as 4 or 5 different people. At JB Mortgage Capital, Inc. you will work with one person from loan application to closing. You will always know who to call or email and this allows for a much smoother refinance process. Since we don’t have “loan processors” this also keeps our costs down.
Important Money Saving Tips When Refinancing
First Money Saving Refinance Tip:
Make sure you work with a well respected mortgage company. In only takes a few minutes to check their Better Business Bureau rating and other online resources. Avoid companies with a questionable reputation.
Second Money Saving Refinance Tip:
As the loan officer before or during the loan application when the mortgage rate and terms will be locked in. Knowing when your rate and terms are locked in could save you thousands of dollars and prevent closing delays.
Team of Professionals:
Our team of professionals works hard to make sure each refinance transaction goes smoothly and closes on time. JB Mortgage Capital, Inc. specializes in providing great California home loan rates for FHA, Conventional and Jumbo loans. We have the knowledge and experience to locate the best possible terms and understand what is needed to ensure your refinance closes exactly as promised. With over 14 years in the mortgage industry; Loan Officer Kevin O’Connor and his team put the client first. We listen to what our clients needs are and then find solutions.
Important Points To Consider When Refinancing:
- Mortgage rates change daily; sometimes two-three times a day. If you believe your mortgage rate is locked make sure you receive a written confirmation. Don’t assume it’s locked
- Be open to suggestions from the Loan Officer how to best structure the mortgage to your benefit
- Only send in documentation that is requested. If you can not locate it discuss that with the Loan Officer before sending in additional documentation.
Completing a refinance In California can be easier than a purchase and at JB Mortgage Capital, Inc. we’ll do everything to make sure the process is efficient, smooth and fast.
Total Number Of Housing Units In California
Great Loan Programs:
30 Year fixed rates, 20 year fixed rates and 15 year fixed rates are our most popular products in California. We do offer a 10 year fixed rate mortgage as well however not may homeowners take advantage of the shorter term mortgage due to the high payment. We offer a wide range of fixed rate products so that we can secure the best possible mortgage rate.
Adjustable rate mortgages (ARMs) are another option for clients and the most popular adjustable rate loan programs seem to be the 7/1 and 10/1 ARMs. This gives the client a lower rate when compared to a 30 year fixed and has a longer fixed rate period than the traditional 5/1 ARM. Most ARMs are based on the 1 year LIBOR (as of 2019) and just in case a client prefers a shorter fixed term we do offer the 5/1 ARM as well. If you live in California and you’re looking to refinance your current mortgage into our best low rate mortgages feel free to contact us for a no obligation – no cost quote.
We offer fixed and adjustable rate mortgages for owner occupied, second and non-owner occupied homes. We are a California mortgage company that offers low California mortgage rates to each and every client. We also offer no cost loans with excellent service!
Conventional – Conforming Loan Programs:
Most people don’t know this but there is a difference between a Conventional loans and Conforming Loans. And that a Conforming loan is a Conventional loan. A Conventional loan is any loan not in the FHA Loan category or more specifically any home loan that is not guaranteed by the government. A Conforming loan is a Conventional loan however these loans “conform” to Fannie Mae and Freddie Mac underwriting guidelines.
If you have a a 700 credit score or higher you probably a good fit for these types of loans. Or if you are buying rental property you’ll have to go with Conventional financing.
FHA Loan Programs:
If you have a credit score below 700 and/or have little equity or a small down-payment the FHA loan program is something you should consider. We cover all the ins and outs of the FHA home loan program and we encourage you to take the time to discover if a FHA loan is right for you. As mentioned before; if you have any questions please be sure to ask. You can use the FHA home loan program to purchase a home or refinance a current mortgage you already have. FHA loans can only be used for primary residences; 1-4 units. No rental or commercial are properties allowed.
Notes About California Mortgage rates And Guidelines:
- Mortgage rates vary from state to state and in California mortgage rates tend to be a bit higher than rates in other states. Not always, but sometimes and it really depends on market conditions. Be sure to receive an update on current mortgage rates prior to locking in terms.
- In California lenders generally request an appraisal be done even if you’ve had one completed in the last 3-6 months. For some transaction in California an appraisal waiver is granted.
- California has one of the largest mortgage markets in the entire country.
- Refinance transactions in California generally take 21-30 days however it could take longer if submission volume is high or if there is a subordination of a second mortgage or equity line.
- California refinance volume has been low the last few years however its expected to increase if mortgage rates remain low in 2019.
Is Now The Right Time To Refinance:
For some homeowners in California the answer is yes and for others it’s no. The most important two questions a homeowner can ask is; what is my current rate/term and what am I looking to accomplish with a refinance? Previously on koloans.com we discussed this and more to help our clients figure out if now is the right time to refinance their current mortgage. If you are not taking cash out or trying to lower your term from a 30 year fixed rate to a 15 year fixed rate then you generally want to see a .50% or more decrease in your mortgage rate.
There are cases, especially on large loans, where even a .25% to .375% drop might make sense depending on the structure of their current mortgage and the new mortgage loan they’re considering. If you live in California and have any questions we encourage you to contact us by phone or through our website. We’ll take the time to answer your questions, understand what you’re trying to accomplish and then find solutions that meet your needs.
Here are some interesting facts about California:
- There are 58 counties in California
- California has 482 cities/townships
- The rate of homeownership in California was 54% in 2017
- The median home price for a home in California topped $600,000 for the first time ever in 2018. Business Insider
- According to CoreLogic; mortgage delinquency rates in California declined in 2018
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Less Than Perfect Credit Refinance:
Sometimes people fall on hard times and because of that their credit report and credit score suffers. It happens in California and all across the country. Maybe it was due to a job loss or maybe it was due to a medical emergency; whatever the reason most homeowners in California want an opportunity to get back on their feet.
At JB Mortgage Capital, Inc. we work directly with those that have fallen on hard times and try to help them with improving their financial situation. Having less than perfect credit does not mean you can’t refinance your mortgage.
Here are some basic facts that someone with less than perfect credit may find useful:
- If you live in California and you have a credit score above 580 we have loan programs that might that could put you on a better financial path. There are times we may be able to go below that as well.
- Unlike other mortgage companies in California we do not charge excessive points/origination fees
- We never charge any junk fees
- We can discuss a long term plan as well to ensure this is not just a short term solution
- You may be able to add your high interest credit card debt into your mortgage potentially saving you hundreds or even thousands of dollars per month.
JB Mortgage Capital, Inc.:
Doing your next refinance of your current mortgage with JB Mortgage Capital, Inc. is a smart choice. We have an A+ rating with the California Better Business Bureau and we’re AAA rated with the California Business Consumers Alliance. We offer a wide variety of mortgage programs, industry low mortgage rates and we provide top notch customer service. If you live in California and you’re in the market for a low 30 year fixed rate, 15 year fixed rate or any other type of mortgage please be sure to give us a call at 1-800-550-5538 for a no-cost/no-obligation quote.