Should you consider refinancing your mortgage?

Refinancing?

The purpose of home mortgage loan refinancing is to acquire a mortgage at a lower loan interest rate for you home refinancing and utilize substantial monthly savings for more immediate requirements.

If you are less than happy with your existing mortgage lender, a home mortgage loan refinancing could get you with a better terms or a lower payment amount. If you used a risky adjustable rate mortgage to purchase your home and are due to have your loan reset it could give you much needed financial peace of mind.

Why should i refinancing my house? Does it make any sense?

Probably yes, probably not. Here are a few things you should ponder, would you like to have:

1. A better interest rate
2. A lower monthly instalment
3. To consolidate your debts which attract high interest rates, ie, credit cards or hire purchase
4. Additional funds for renovation of your home or personal use
5. To enjoy new features offered in other loan packages, ie all-in-one account
6. Enjoy some tax advantages.

Cost of Refinancing?

If properly advised, refinancing can save you a substantial amount of money. However the disadvantage is the cost involved in refinancing, ie legal cost, stamp duty and disbursements. You will have to weigh whether or not the benefits (ie the saving in interest) in the long run outweigh the short-terms costs of refinancing. If you are deterred by the costs of refinancing, there are loan packages where the new bank or lender will absorb and pay the legal cost stamp duty and disbursements of refinancing. Of course such lenders will price such costs into the interest rates offered but invariably refinancing will save you money if your existing loan is more than three (3) years old. Types of Home mortgage refinancing Loan you can opt in for Rate and Term Refinancing- This refers to a change in the rate and term of an existing loan or mortgage. Rate and term mortgage refinance allows you to secure a lower interest rate, change the terms, or opt for a lower payment plan all without paying off any additional debts. Cash-Out Refinancing- A cash-out refinance differs from rate and term refinance in an aspect that the new loan amount is larger than the existing loan amount due to the additional cash you take with the new loan. By opting for a cash-out refinancing, you can pay off your debts on top of their existing loan amount, and changing the rate and term of the existing loan at the same time. If you need to know more about refinancing drop us an e-mail at mortgage2hedge@gmail.com