What Can Be Gained By Refinancing Your Mortgage

What Can Be Gained By Refinancing Your Mortgage



What Can Be Gained By Refinancing Your Mortgage?
Many people are doing it,​ but should you? Getting a​ new mortgage to​ replace the​ old one could be very sound advice – but not every time .​
Here are some things that you​ could gain if​ you​ refinance your mortgage .​
Lower Interest Rates
One of​ the​ best reasons to​ refinance is​ to​ be able to​ get a​ better interest rate and lower your monthly payments .​
This,​ of​ course,​ leads to​ more savings .​
Since the​ interest rates on​ mortgages changes every day,​ it​ is​ always a​ good idea to​ keep one eye on​ those changes .​
When the​ interest rates drop more than 1% lower than what you​ already have,​ it​ is​ one indication that you​ can save some money .​
Save Some Money
The amount of​ money you​ can save by a​ lower interest rate,​ however,​ is​ not all that can be gained .​
In fact,​ you​ could save much more if​ you​ also reduce the​ amount of​ time left to​ pay off the​ mortgage .​
By keeping your payments about the​ same and shortening the​ time by at​ least five years,​ you​ could save additional tens of​ thousands of​ dollars more .​
Get Your Equity
At the​ same time that you​ refinance your mortgage,​ you​ can also get access to​ some of​ your equity .​
a​ cash out mortgage refinance will enable you​ to​ get your equity and provide the​ cash you​ may need for that home project,​ or​ other need .​
Be sure that you​ leave at​ least 20% of​ you​ home’s value in​ the​ equity – don’t take it​ out .​
This way,​ you​ will not need to​ get private mortgage insurance .​
It will also enable you​ to​ have a​ reserve cash supply,​ just in​ case you​ need to​ move later .​
Obtain Level Payments
If you​ currently have an​ adjustable rate mortgage that is​ about to​ become adjustable in​ its payments,​ you​ may need to​ quickly refinance in​ order to​ reduce your risk .​
When the​ rates go up – so will your payments,​ but you​ can refinance to​ a​ more stable fixed rate mortgage .​
If you​ wait too long to​ refinance,​ you​ could be stuck with the​ interest rates that the​ market will force you​ to​ have – whether you​ have adjustable rate or​ fixed rate .​
Calculate Your Options
It is​ important that you​ take some time and make some serious calculations .​
You should not refinance just because your friends are,​ or​ your neighbors .​
Your situation could be (and probably is) different from theirs .​
Once you​ have determined that you​ are going to​ stay for at​ least another 3 to​ 5 years,​ you​ should calculate the​ different options available and see which ones are most profitable .​
Some mortgage types may not be suitable for you​ to​ get a​ good deal on,​ but you​ will need to​ look them over first to​ find out which ones will give you​ the​ greatest benefit and savings .​
Be sure to​ get quotes from different lenders and then compare them .​
Refinancing your mortgage is​ something you​ cannot do very often,​ because of​ the​ cost – so get the​ best one you​ can.




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