September 2016
President’s Corner
Articles from our President & CEO
on topics important to our members.
Refinance Your Mortgage to Save Money—and So Much More!
“R
ates are at historic lows right now!!” News reporters,
commercials, friends and family keep repeating this
phrase… but what does it really mean for you?
If you have a mortgage, it could mean thousands of
dollars of savings over the life of the loan. Think about
that: thousands of dollars!
Despite that, many borrowers who became homeowners
over the last 4-5 years have not participated in today’s low
mortgage interest rates. The reasons we typically hear are
things like, “With the rate I have now, it’s just not going to
save me enough to make it worthwhile,” or, “I only put 5%
down and I don’t have enough equity.”
Here are a few other considerations to help you decide
whether a mortgage refi is right for you:
Increase cash flow and affordability
Many of our members are considering retirement, and cash
flow is a prime consideration in their timing. Increasing the
terms of their mortgages and taking advantage of a lower
interest rate could make retirement an attainable objective. Consider this: a $120,000 30-year mortgage taken out
10 years ago at a 7.0% interest rate might have a monthly
principal and interest payment of $798.* Refinancing at
today’s low interest rate of 3.5% and increasing the term
back to 30 could change that monthly principal and
interest payment to $539—a cash flow savings
of $259 per month!
At Reliant, we try to do
At Reliant, we try to do everything we
everything we can to
can to help you, our members, save
Remove Mortgage Insurance
help you, our members,
money. We do this by recommending
When a member takes out a conventional
save
money.
the consolidation of consumer revolving
mortgage loan with less than a 20% down
debt into fixed-rate and -term
payment, the lender typically requires
installment loans, for example, or by
mortgage insurance. Mortgage Insurance on
refinancing auto loans you’ve obtained
most conventional loans discontinues when
elsewhere to lower interest rate loans here at Reliant.
the loan has been paid down to 78% or less of the original
value. Mortgage insurance on a typical conventional loan
Similarly, most of us know that refinancing an existing
with minimum down payment can exceed $100 per month.
mortgage loan into a lower-rate or a shorter-term mortBy refinancing at today’s low interest rates and changing
gage has the potential to save money—but the math is a
a mortgage term to 20 years, a member can often reduce
little more complex, and there are often closing costs and
mortgage insurance costs or remove them entirely, reduce
fees involved. While savings may or may not always be
his mortgage payment, and shorten the term of his loan
dramatic, a mortgage refinance might be a good fit for you
considerably.
for so many other reasons.
*Rates and other figures are for illustrative purposes only.
reliantcu.com
Page 1 of 2
President’s Corner Refinance Your Mortgage to Save Money—and So Much More!
September 2016 continued
Refinance to cash out on home equity.
In reality, there are many reasons why refinancing might be
You may have goals of improving your home’s livability by
the right fit for you, and the three reasons mentioned above
adding a room, an in-law suite or garage. A Reliant home
are just the beginning — we’d love the opportunity to tell
equity loan can be a great tool for accomplishing these
you more!
goals. Another way to reach those
goals is through refinancing your
Stop by a branch or call our Member
Stop by a branch or call our
existing mortgage—and if you have
Service Center to set up an appointment
Member
Service
Center
to
set
sufficient equity, you can take advanwith one of our experienced, knowledgeup an appointment with one of
tage of both a lower interest rate and
able mortgage originators. Our staff is a
our experienced, knowledgeable
the cash out to do what you want.
great resource for our members when you
mortgage originators.
need to make an informed decision!
Using your home’s equity by doing a
cash-out refi is not just for property
Today’s mortgage interest rates are some
improvements! For instance, it may make sense to buy an
of the lowest in history and taking advantage of them is an
investment property, start a business, help a child with
opportunity I hope you’ll explore.
tuition or student loans—or pay off your own student loans!
There are endless possibilities!
To help you get started, we’ve added a new Mortgage
Refinance page to our website! I invite you to take the time
The bottom line is this: we want to help you, our members,
to read through the page.
save money—and refinancing your mortgage may be a
great way to accomplish that.
Thank you for your continued loyalty to and membership with Reliant!
Pamela Heald
President & CEO
[email protected]
reliantcu.com
Page 2 of 2