Essential Mortgage

Refinance

FLEXIBLE FINANCING.

For any stage of life.

Dinning Room

FLEXIBLE FINANCING.

For any stage of life.

A refinance can be a smart financial move if timed properly. Not only could it help you lower your interest rate and monthly payment, but it also may help you pay off your loan sooner, leverage your home equity, and pay off renovations or higher-interest debts.

Are you considering a refinance on your Louisiana mortgage loan? Keep reading to learn more about refinancing below or reach out to Essential Mortgage to get the process started today.

IS IT THE RIGHT TIME TO REFINANCE?

If you want to maximize the financial benefits of your refinance, then timing is critical.

For the most part, a refinance is a good choice if:

  • Current market rates are lower than the interest rate on your current loan. Refinancing could mean less paid in interest and a lower monthly payment.
  • Your home value has increased significantly since you bought it. Refinancing would allow you to tap this increased home equity.
  • You have an adjustable-rate loan and the fixed-rate period is about to expire. You could refinance into a fixed-rate loan to prevent any rate increases.
  • You’re within the first 10 years of your loan (when most of your payments are going toward interest). Since you’re not paying down much of your principal balance just yet, it might be a safe time to refinance for better terms.
  • You have a good amount of equity in your home. Cash-out refinancing would turn this equity into cash to put toward medical bills, tuition, home repairs/renovations or consolidating higher-interest debts.

If you want to maximize the financial benefits of your refinance, then timing is critical.

For the most part, a refinance is a good choice if:

  • Current market rates are lower than the interest rate on your current loan. Refinancing could mean less paid in interest and a lower monthly payment.
  • Your home value has increased significantly since you bought it. Refinancing would allow you to tap this increased home equity.
  • You have an adjustable-rate loan and the fixed-rate period is about to expire. You could refinance into a fixed-rate loan to prevent any rate increases.
  • You’re within the first 10 years of your loan (when most of your payments are going toward interest). Since you’re not paying down much of your principal balance just yet, it might be a safe time to refinance for better terms.
  • You have a good amount of equity in your home. Cash-out refinancing would turn this equity into cash to put toward medical bills, tuition, home repairs/renovations or consolidating higher-interest debts.


Refinancing is typically not the best move if you’re well into your loan. A refinance essentially replaces and resets your loan, putting you back at square one on the repayment schedule. You’d again be paying mostly interest for the first decade of your loan, negating any savings for some time.

Refinancing is typically not the best move if you’re well into your loan. A refinance essentially replaces and resets your loan, putting you back at square one on the repayment schedule. You’d again be paying mostly interest for the first decade of your loan, negating any savings for some time.

DO YOU NEED ACCESS TO CASH?

Refinancing allows you to change the rate, terms and payment associated with your home loan, as well as turn your home equity into cash (called cash-out refinancing). You can use your refinance for one, the other or both purposes, so it’s important to assess your cash flow needs before applying for your new loan.

Cash-out refinancing offers a one-time lump sum payment you can use toward any expenses you might be dealing with. Many homeowners use these funds for:

  • Home repairs and renovations
  • Cars
  • Wedding costs
  • Vacations
  • College tuition
  • Medical bills


Many homeowners also use cash-out refinances to consolidate their higher-interest debts. Because mortgage loans offer much lower interest rates than most credit cards, car loans and other financial products, using a cash-out refinance to cover these costs and essentially roll them into your mortgage payment can mean significantly less paid in interest over time. As an added benefit, mortgage interest is deductible on your annual tax returns, whereas interest on other loans is not.

ARE YOU READY?

As with your first mortgage loan, your refinance will require various forms of documentation along the way. To ensure your loan process goes as efficiently as possible, try to gather and organize your paperwork before beginning your application.

You also may want to pull your annual credit reports to gauge your current credit score and profile. This will influence the interest rate you’ll qualify for, and thus your monthly payments.

You should also speak to a qualified loan officer before moving forward. There are many options when it comes to refinancing and timing your loan application properly is critical. An experienced expert can walk you through your options, as well as guide you toward the right process and timing for your specific situation.

WHAT’S NEXT?

Once you’ve decided to move forward with your refinance, you’ll need to fill out an application, lock your interest rate, and provide your documentation. Then, your mortgage lender will take it from there. The entire process typically takes a few weeks, at most.

Are you looking to refinance your home mortgage loan to lower your rate or payment, consolidate debts, or cover expenses? Essential Mortgage can help. Contact us to get started.