Your big questions answered


How do I know when the interest rates are low enough to begin my next home improvement project?  You may never know when the rates are at their absolute lowest, but home improvement projects typically add value to your home, so this is always a good thing to do regardless of the interest rate.


When is it a good time to refinance my home? If you can reduce the term while keeping your mortgage payment the same, for example refinance a 30 year mortgage into a 15 year mortgage, you will save thousands of dollars in interest.  On the other hand, some homeowners need payment relief and choose to refinance their mortgage to a longer term to reduce their monthly payment. This decision should be based on individual needs and wants.  The old general guideline of a 2% reduction in interest isn't necessarily valid in today's market. Jax Federal Credit Union's mortgage expert can help you determine if it is the right time for you to refinance. 


How do I know if I should take out a 15 yr, 20 yr or 30 yr mortgage? First, determine if you can afford the monthly payment based on your income and other expenses. In today's market conditions, most people are selecting a 15-year mortgage to reduce the term, while others are choosing a 30 year mortgage to keep their monthly payment low.  This choice is really based on individual needs and wants. Jax Federal Credit Union's Mortgage Center is a great online resource to compare the variety of mortgage terms


Have home values leveled off or are they still dropping?  This answer really depends upon which part of Jacksonville you are looking at.  Some areas have leveled off, while some parts of the city are increasing, and other areas are still dropping.  A good resource for consumers to look up their own home or one they may be considering purchasing is www.Zillow.com.  While the home values estimates may not be exactly accurate, their trend line for home values will give some indication of an upswing or downswing. 


Have foreclosures slowed down? Early indications are showing that overall foreclosures are slowing down.


How do I buy a foreclosed home and then have the funds necessary to fix it up? It's a good idea to work with a realtor who has some experience in handling foreclosures, because they will be able to better align your purchase expectations.  You should fully understand the scope of improvements needed, and adequately budget for the needed repairs either through your own savings, or consider a No Equity Home Improvement Loan. 


What are the differences between a fixed rate and other types of mortgages? With a Fixed rate, your rate will stay the same for the stated term (duration) Fixed rates are more popular now because of the very low rate environment we're in. Homeowners want to "Lock in" a low rate.  Adjustable Rate Mortgages (ARMs) can change and are more popular in more uncertain rate environments.  Many years ago, when rates were much higher and heading downward, homeowners preferred ARM's because they didn't want to "Lock in" at a high rate. Also, if you know you aren't going to be in your home for a long time, you may want to consider an ARM.  The ARM may be fixed for the first 5 years and then adjust annually after that as in the case of a 5/1 ARM.  There are many variations, terms, rate structures of ARMs. Seek the advice of a mortgage expert to help you understand which mortgage is right for you. 


How can I get a loan for home improvements when I have no equity in my home?  When home improvements seem impossible because the market has squeezed your home's equity, JAXFCU has a unique loan product for well-qualified borrowers to make those needed improvements. This loan is only for the financing of home improvements on the borrower's primary residence. Loan amounts range from $5,000 to $25,000 and there are options for working with a contractor or do-it-yourself projects. There are no closings costs and no home appraisal is required. 


What's a home equity line of credit? A Home Equity Line of Credit (HELOC) is a revolving credit line with a variable interest rate and payments. A HELOC provides an accessible source of cash with variable rates that are lower than a credit card.  You can control the monthly payment based on outstanding balance, and funds can be advanced with convenience checks or through online banking. 

Information provided by Jax Federal Credit Union