If your current mortgage term is coming to an end, be assured there are many different options to further help a client in regards to their mortgage. Refinancing could be another possibility and beneficial option, as it can save you money, build equity, and pay off the mortgage faster.
Refinancing a Mortgage
Refinancing is when a borrower renegotiates the terms on the old mortgage loan contract to select new terms. This refinanced mortgage is set up to have better terms to improve finances for the borrower. Refinancing also pays off and replaces the old loan.
Refinancing is often used to lower monthly payments. This will save the borrower paying on interest. A refinanced mortgage can also be used to pay off consolidated debts, such as other high-interest loans. Refinancing a mortgage is often used to pay off debts. A client can refinance the mortgage as often as he or she needs to, however, the client must make sure it makes sense for the financial situation. If a borrower wants to refinance again, there will have to be a six or seven months wait time between refinancing.
Remember, refinancing replaces the old loan for a new one that is greater than the one held previously. The new loan usually has lower interest rates, with a repayment period of approximately 30 years. A borrower gets to choose the length of the term when he or she refinances the mortgage. As always, it is a good idea to check with a trusted mortgage broker or lender to see if any repayment penalties will apply to the particular refinancing loan.
Reasons you should Refinance your Mortgage?
- By refinancing your mortgage, you will lower your monthly interest payments. Refinancing will also help you save on interest.
- A refinanced mortgage loan can be used to pay off other high-interest loans or debts consolidate in a single, lower monthly payment.
- If there happens to be an emergency, you can use your home’s equity to take out funds. This can be helpful when you are suddenly faced with sudden immediately-needed repairs or educational tuition fees.
- When interest rates are low, that is the time to refinance a mortgage. This can help you save on interest rates during the lifetime of your loan. Refinancing at the right time would allow the rates to drop.
- If you are planning on refinancing a mortgage when you have built up equity on your home (equity is the difference between the worth of the home and what is owed.)
- It may be the right time to refinance your mortgage if you are planning on changing mortgage companies.
- Think about what you want as your financial goals. If you are struggling to make mortgage payments, it may be time to refinance so you can reach those goals
Let our mortgage company help you discover if refinancing is right for your financial goals. We can guide you with expert advice through the whole process. Ask your mortgage broker about a refinancing solution that suits you.