Refinance

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Take advantage of historic low rates. Refinance today.

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Save Money

The most common reason for refinancing is to save money. Saving money through refinancing can be achieved several ways. The two most common ways are:

  1. By obtaining a lower interest rate that causes one’s monthly mortgage payment to be reduced
  2. By reducing the term of the loan, thus saving money over the life of the loan. For example, refinancing from a 30-year loan to a 15-year loan might result in higher monthly payments, but the total interest paid during the life of the loan can be reduced significantly.

Stability And Security

People also refinance to convert their adjustable loan to a fixed loan. The main reason for doing this is to obtain the stability and the security of a fixed loan. Fixed loans are very popular when interest rates are low, whereas adjustable loans tend to be more popular when rates are higher. When rates are low, homeowners refinance to lock in low rates. When rates are high, homeowners prefer adjustable loans to obtain lower payments.

Consolidate Debt

A third reason why homeowners refinance is to consolidate debts and replace high-rate loans with a low-rate mortgage. The loans being consolidated may include second mortgages, credit lines, student loans, credit cards, etc. In many cases, debt consolidation results in tax savings, since consumer loans are not tax deductible, while a mortgage loan is usually tax deductible.

Does Refinancing Add Up?

The answer to the question, “Should I refinance?” is a complex one, since every situation is different and no two homeowners are in the exact same situation. The conventional wisdom of refinancing only when you can save 1 percent on your rate is problematic. If you are refinancing to lower your monthly payments, the following calculation is more appropriate compared to the 1 percent rule:

  1. Calculate the total cost of the refinance–example: $2,000
  2. Calculate the monthly savings–example: $100/month
  3. Divide the result in 1 by the result in 2–in this case 2000/100 = 20 months.  This shows the break-even time period. If you plan to live in the home for longer than this period of time, it likely makes sense to refinance.

Balloon About To Pop?

Sometimes, you do not have a choice – you are forced to refinance. This happens when you have a loan with a balloon payment and no conversion option. In this case it is best to refinance a few months before the balloon payment is due. Whatever your reason for refinancing, consulting with a seasoned mortgage professional can save you time and money.


We work with many trusted lending sources to find the right fit for your specific situation.

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    Granite Mortgage Company
    3459 Lake Elmo Ave N
    P.O. Box 881
    Lake Elmo, MN 55042

    NMLS# 285381

    Licensed Mortgage Originator in the State of Minnesota
    Licensed Mortgage Broker in the Sate of Wisconsin

    © 2016 Granite Mortgage Company  equal housing lender

    Granite Mortgage Company Logo

    Granite Mortgage Company
    3459 Lake Elmo Ave N
    P.O. Box 881
    Lake Elmo, MN 55042
    Main Number:
    651-459-6000
    Fax Number:
    651-459-6700