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If you have taken a fixed interest mortgage loan some time back, you chose the fixed interest option because you could budget your monthly payments precisely. However, interest rates fluctuate. If the rate is higher now than what you are paying on your existing mortgage, good for you. In hindsight, you made a good move by choosing a fixed rate mortgage loan. But if the rate is lower now, you are paying more than what you would be paying if you had chose an adjustable rate option. In such a situation, it is advisable that you go for mortgage refinance. In this report, we shall look at the mortgage refinance options available in the state of Pennsylvania. Let's however first understand what mortgage refinance is.

 

What is mortgage refinance

 Mortgage refinance means the 'refinancing' of your house with a new loan under existing market rates. The new loan will pay off the balance of your old loan, and you will continue paying out the new mortgage on the more favorable terms that apply now. Mortgage refinance results in lower monthly repayments or a shorter payback period.

 

When not to take mortgage refinance

 

When you should opt for mortgage refinance is obvious from the foregoing. There also are situations when mortgage refinance is not advisable even if rates are lower now, especially if your repayment of your existing loan is nearing completion (remember that you may have to pay a refinance fee which can offset the advantage of a lower interest rate). Do get rates from the broker or lender (you can access many on the Internet) and see if it really makes sense to you. You should be saving a sizeable number of dollars every month if you take refinance; otherwise don't take it.




Pennsylvania mortgage refinance

 

Mortgage loans, hence mortgage refinance too since it is a new mortgage loan, available in Pennsylvania are:

 

Conforming Mortgage Rates *

Jumbo Mortgage Rates **

30 Years Fixed Rate
15 Years Fixed Rate
5/1 Adjustable Rate Mortgage
3/1 Adjustable Rate Mortgage
One Year Adjustable Rate Mortgage
Interest Only Mortgage 3/1 ARM
Interest Only Mortgage 5/1 ARM
40 Year Fixed Rate Mortgage

30 Years Fixed Rate
15 Years Fixed Rate
5/1 Adjustable Rate Mortgage
3/1 Adjustable Rate Mortgage
One Year Adjustable Rate Mortgage
Interest Only Mortgage 3/1 ARM
Interest Only Mortgage 5/1 ARM
40 Year Fixed Rate Mortgage

*Conforming mortgage is mortgage that does not exceed the maximum mortgage limit of the two primary Government Sponsored Enterprises (GSEs), Fannie Mae and Freddie Mac.

**Jumbo mortgage is mortgage whose amount exceeding the limits of conforming mortgage. Interest rates on jumbo mortgages are usually between 1/4-5/8% higher than on conforming mortgages.

 

Conclusion

Since interest rates fluctuate according to Federal Reserve Board policies, your monthly payments on mortgage can be lowered when interest rates are lower. Mortgage refinance is a good option if it saves you a sizeable amount of money. In Pennsylvania, both conforming mortgage and jumbo mortgage options are available, and you can determine whether refinance is good for you by using one of the online calculators which you can access at www.erate.com and www.mortgageloan.com among others.