Refinance Loans

Bethel, CT Refinance Loans

Refinancing a mortgage in Bethel, CT involves taking out a new loan that replaces an existing mortgage, or getting a new loan to pay off both a first and second mortgage. There are many reasons to refinance in Bethel, CT including locking into a lower interest rate, cashing out the equity in your home, or switching from an adjustable rate mortgage to a fixed-rate loan.

Refinancing in Bethel, CT usually requires having little monthly debt and very good credit, as well as money for closing costs.

Why Should You Refinance Bethel, CT

Bethel, CT Cash Out Refinance

One reason to refinance your Bethel, CT mortgage is to cash out of your equity. This requires having a sizable amount of equity so you can refinance into a loan with a higher balance. This may be a good option if you want to pay off debt, pay for a large purchase, or pay to go back to school, for example. Cash out refinance loans in Bethel, CT typically have higher interest rates than regular refinance loans, but the rate will still be lower than most loans and credit cards. Remember that you will pay more in the long run, however, you will be paying on the loan for 15 to 30 years and the refinance can turn unsecured debt into secured debt.

Lower Interest Rate in Bethel, CT

The most popular reason to refinance a mortgage in Bethel, CT is to lock into a lower rate. If you want to take advantage of lower rates and lower your monthly mortgage payment, remember that your current interest rate should be around 1% higher to make it worthwhile, as you will pay closing costs on a refinance.

Cash Out Refinance Bethel, CT

Refinance to a Fixed Rate in Bethel, CT


If you have an adjustable rate mortgage (ARM) that is about to reset, or you have a loan with a balloon payment, you may want to refinance into a fixed rate mortgage. You can also refinance in Bethel, CT to turn a fixed loan into an adjustable rate mortgage if you wish.

Bethel, CT Downsides of Refinancing

While refinancing can definitely be worth the time and cost, there are disadvantages to refinancing your mortgage. Always check the terms of your current mortgage to make sure you will not be charged a penalty for refinancing. If your loan has a prepayment penalty and you pay off the loan within the first two to five years, you may incur a high fee such as a flat fee, a percentage of the outstanding balance, or an entire month's interest, as the penalty.

Remember, you need to pay closing costs as well. It is important to use a refinance calculator to make sure it is worth it to refinance. A calculator can show you how long it will take to make the refinance pay off. As an example, you can expect to pay around $3,700 out of pocket in closing costs for a $200,000 refinance. Compare the savings you will enjoy each month to your closing costs to see how long it takes to break even.

Refinance to a Fixed Rate Bethel, CT

How to Refinance in Bethel, CT

A refinance in Bethel, CT works just like getting an original mortgage including verification of your income, credit, and employment. You will also need to decide which type of loan you want to refinance into, whether it is a 15-year fixed loan or an ARM.

It is not necessary to refinance with the same lender. You may wish to use a mortgage broker in Bethel, CT to help you get the best rate on your loan. You will need to have a home appraisal after you submit your application to make sure you have enough equity to justify the loan amount.

Underwater Loan Refinance in Bethel, CT

If you owe more than your home is worth, you can still refinance your Bethel, CT mortgage. If you have less than 20% equity or you are completely underwater, the following may be options for you:

How to Refinance a Loan Bethel, CT

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