Through our business affiliate Credit Union Mortgage Association, CUMA, Congressional has special Fannie Mae and FHA Mortgage Products that are being offered for a limited time with a much higher maximum loan amount in designated high cost areas, such as, most of the Washington, D.C. Metropolitan Area.  We must verify the maximum mortgage loan amount available for your property’s location, as the maximum mortgage loan amount varies across the U.S. 

With the expanded maximum mortgage loan amount, new lending rules are also in effect that make it difficult to quote an exact interest rate without all of your personal and property data.  We may quote rate ranges until we have had the opportunity to evaluate your data.

Your answers to the following questions will help you determine if refinancing your home is the best decision for you. Ask yourself:

1. Why do I want to refinance?
   • To lower my monthly payment?
   • To payoff my current mortgage faster?
   • To eliminate private mortgage insurance?
   • Make home improvements?
   • Payoff consumer debt?
2. How long do I plan to own this property?
3. Can I reduce the equity in my home by rolling closing cost into the new mortgage?

Use our worksheets to help you decide if refinancing is right for you. If you still have questions once you have decided to refinance your mortgage, check our Frequently Asked Questions (FAQ) section for more information or contact our Real Estate Lending Team

Do the Benefits of Refinancing Offset the Cost?
You have to compare current available interest rates and the cost of refinancing in order to decide if refinancing is right for you.

What Do I Need to Know to Make My Decision?
In order to make a decision, you will need the following figures:

• Your current monthly Principal and Interest (P&I) payment
• The new anticipated monthly P&I payment based on your projected loan amount, loan term (30, 20, 15 years) and anticipated interest rate
• Estimated closing cost associated with refinancing

Frequently Asked Questions (FAQs)

1. What if I don't have the money to spend on refinancing my primary residence?
2. How much should the interest rate drop before I refinance?
3. What if I decide to move?
4. How much will it cost to refinance?
5. Can I refinance to combine my mortgage and home equity/second mortgage loan?

1. What if I don't have the money to spend on refinancing my primary residence?
You can wrap the closing cost into your new mortgage loan as long as the final loan amount does not exceed 90% of the fair market value of your home.

If you do a cash-out refinance on your primary residence, you can usually borrow up to 80% of the fair market value; however the pricing will be slightly higher when you exceed 70% of the fair market value of your home.

2. How much should the interest rate drop before I refinance?
Historically, a 1% drop in interest rate has been the point to consider refinancing. However, refinancing may be beneficial to you even if the rate reduction is less than 1%. Deciding to refinance depends on the terms of your current mortgage.

For example, if you have an Adjustable Rate Mortgage (ARM) with a current rate of 7%, you may want to consider refinancing your mortgage to lock into a 30-year fixed rate loan at 7% or even a slightly higher rate.

3. What if I decide to move?
If you do not plan to live in your current residence much longer, refinancing may not be an advantage because there are closing costs involved. You must decide if you will be staying long enough to recoup the cost and reap the benefit of a lower interest rate.

4. How much will it cost to refinance?
Costs vary, but refinancing your mortgage may cost between 2-4% of your current loan balance. This cost depends on several factors: lenders fees, discount points, origination fees, settlement fees and state and county fees. You will want to obtain an estimate of all these costs.

5. Can I refinance to combine my mortgage and home equity/second mortgage loans?
Yes. If you decide to combine your first and second mortgage loans, you can usually finance up to 80% of the current fair market value of your home.

We offer home equity loans and lines of credit throughout most of the continental U.S. in amounts up to $250,000 (on your primary residence only). The maximum loan or line of credit is 90% of the current value of your home less the amount you currently owe on your first mortgage (subject to a review of your credit and debt ratio).

What's the Difference?
A Home Equity Loan gives you all of the funds at once, at a fixed interest rate, for a certain period of time. This means your monthly payment is fixed over the life of the loan. Congressional offers terms of 5, 7, 10, and 15 years.

A Home Equity Line of Credit allows you to draw funds as you want to, up to an approved limit. Your monthly payment is based upon the amount you actually use. This flexibility can come in handy if you don't need all the funds at once. The term is 10 years, which means you access the funds for this period and must pay off the amount you used before the 10 years expires.

Save Money with a Congressional Loan
Congressional Home Equity Loans and Lines of Credit have:

• No application fees
• No annual fees
• No points
• No prepayment penalties (home equity loans)

We offer several different home equity plans (and will even pay your closing costs on some home equity lines of credit). In the Washington, D.C. area, closing costs range from $500 to $900 on a $50,000 home equity loan or line of credit. You can include all closing costs (except the cost of the appraisal and flood research fee) in your loan or initial advance. Adequate homeowners insurance (and flood insurance if applicable) on a property securing a home equity line of credit or loan is required.

The Reason for the Loan is Up to You
Use your Home Equity Loan or Line of Credit to pay for:

• Home improvements
• Tuition
• Wedding
• Vacation
• Car purchase
• Orthodontia
• Any reason!

Real estate loans tend to have lower interest rates than other types of loans. With this in mind, plus the potential tax savings, using a home equity loan or line of credit may offer the greatest value.