Are you having a hard time making monthly mortgage payments? In an APR mortgage loan and seen it go up in recent months? Looking to free up some extra cash to pay other bills, take a vacation, improve your home, or for anything else? Than refinancing your home mortgage may be the right decision for you. Of course only if it is done right.

So, what does refinancing a mortgage mean?
Kinda like the name, it means to re-finance a prior loan, ideally at better rates or with better terms and conditions. Homeowners tap into the equity they have built up in their home and pay down the principal on their mortgage. This is the reason that sometimes refinancing can be called a home equity loan.

What is equity in your home? How do you get that?
That means that your home is worth more than you owe on the mortgage. For example if your home is worth $100,000 on the market but you only owe $75,000 on your mortgage, you have $25,000 in equity in your home. There are many mortgage lenders who will work with you especially if you have equity in your home. Sometimes homeowners may choose to use that equity in their refinance and get cash out from that when they refinance their mortgage. Also, the most common reason to refinance is still to get better mortgage rates. It is likely that since you bought your home your credit has improved as you paid your mortgage payments on time and in full every month. It is likely that with the current near record low mortgage rates, you will get much better interest rates on your home mortgage through refinancing. This means lower payments every month that could save you hundreds of dollars to do with whatever you want. Also, getting into a mortgage with better terms, conditions, switching from an adjusted mortgage to a fixed rate mortgage , or better customer service is another pretty common reason, Overall the savings can total thousands and thousands of dollars over the length of the mortgage loan. For a lot of homeowners refinancing now could be a great financial relief as extra money could be used to pay other bills, home improvements, repairs, or just for saving. However not all homeowners will benefit from a home refinance. Do your research and calculations to get a good rough idea before going any further into refinancing. Research potential mortgage lenders and get a good quote written down on paper. Shop that quote around to different mortgage lenders and they will usually meet or beat the quote you bring in. Make sure you practice patience and do the right research in regards to potential mortgage lenders. If you refinance the right way you will save thousands of dollars, if not it can be a very costly decision.

Subscribe via email

Enter your email address:

Delivered by FeedBurner