Texas refinance continues to increase as people are pulling equity of their homes to pay for bills or to take advantage of low interest rates. Texas Mortgage Brokers association reported that its quarterly adjusted index of home refinancing applications jumped to more than 30 percent ending January 10. It was the highest level of activity since the first week of December. The average 30-year fixed mortgage rate eased 0.32 percentage point to 5.73 percent, the MBA says. The 30-year rate was the lowest since 5.72 percent the week ended Sept. 9, 2005.

Ryan Hamilton, Sr. Loan Officer with Houston Mortgage Brokers association, said that "With the influx of new loan applicants, we always like to educate our customers before they make any final decisions regarding their home loans. I find it very useful to educate our customers on all fronts regarding their loan options and will help them compare the various loan programs." Some key points I like to discuss with my clients are how to compare loan programs and calculate rates.

Texas Mortgage Refinance Loans

Whether you, our customers, live in Austin, Dallas or the Houston markets, finding the best possible mortgages in Texas can be difficult if you aren't educated on how different loan programs work and the benefits and differences of each program. Things Texas home owners should consider before refinancing their homes.

The annual percentage rate (APR) includes the upfront costs of the loan, while the stated rate does not. The APR helps you compare mortgages that have different closing costs.

Texas Adjustable Rate Home Loans
There are several adjustable rate mortgages (ARMs) options available in Texas. These mortgage loans start with a low, fixed interest rate that remains in force for a specified time, typically 1, 3 or 5 years. When this period expires, the rate then becomes variable, and it will start adjusting at regular time periods. Adjustable mortgages are appropriate for borrowers who need the lowest possible payment now, but either A.) Intend to move before the ARM rate adjusts or B.) expects to have the ability to afford a larger payment later.

Texas Home Equity Loans

Home equity loans are second mortgages that carry a fixed interest rate. They're typically used to raise cash for one-time expenses. Mortgage lendees can expect that your home equity loan rates in Texas are slightly higher than first mortgage interest rates. Even so, customers should consider a home equity loan over a home refinance mortgage if currently locked into a fixed mortgage with low rates.

Compare Texas mortgages
Whether looking to buy a lake house in the Austin, Texas, hill country, or refinancing an urban loft downtown Dallas, the first step is to get familiar with how different loan rates effect your monthly mortgage payments. Typically Texas ARMs start with a lower rate than fixed-rate mortgages (FRMs), or that second mortgages will have higher rates than or mortgage refinances.

Once clients understand the differences in loan options, then educated consumers are more comfortable with the entire lending process and mortgage decision making. Please visit www.lonestarfinancing.com for free Texas refinance mortgage advice and home loan consulting.